Ethereum Price Skyrockets 20% on U.S. Treasury Policy Shift
The Ethereum price surged by 19.8% to $2,291 on Wednesday, significantly outperforming a broad market rally driven by a macro liquidity injection and a historic short squeeze.
A surprise U.S. Treasury policy shift doubled bond buybacks, lowering long-term yields and improving risk appetite across crypto markets. The U.S. Treasury announced that it would increase the size of its government debt repurchases by 'at least double', which triggered a sharp drop in longer-term yields.
The yield on the 30-year Treasury bond plunged from 5.26% to as low as 5.18%, while the 10-year yield dropped from 4.68% to 4.63%. Lower yields reduce the discount rate for future growth, making assets like Ethereum more attractive and signaling looser financial conditions.
The rally was ignited by a macro-driven improvement in risk sentiment, not Ethereum-specific news. It shows a 76% correlation with gold, indicating a rates-driven move.