Treasury Buyback Spree Triggers Bitcoin Surge
On August 19th, 2026, the U.S. Treasury announced it would double its maximum buyback operations for long-end bond securities from $2 billion to at least $4 billion per operation, effective September 9th through November 4th, 2026.
The move triggered a significant drop in 30-year Treasury yields, falling 9 basis points from 5.34% to 5.19%, and causing the term premium to compress.
This compression of the term premium made risk assets more attractive, allowing investors to earn higher returns with less uncertainty.
Bitcoin responded by surging 8.2% in under 12 hours, moving from an intraday low of $64,100 to a peak of $69,500, its highest level since early June.
The dollar flows behind the Treasury buyback operations were significant, with forced short liquidations totaling $1.44 billion across major exchanges and U.S. spot Bitcoin ETFs recording net inflows of $487 million across August 17th and 18th.