Treasury Buybacks Could Send Bitcoin Soaring to $180,000
US Treasury Secretary Scott Bessent has announced that bond buybacks could exceed $4 billion per operation, more than doubling the previous cap of $2 billion. The buyback program targets long-dated bonds maturing in 10 to 30 years and is set to begin on September 9.
The move aims to address thin trading conditions in the bond market, with heavy corporate bond issuance and poor liquidity in the 30-year sector contributing to the intervention.
According to Mark Connors, a veteran bond market investor and chief investment officer at Risk Dimensions, lower long-term yields can benefit Bitcoin. He notes that when the government buys back its own bonds, it supports bond prices and helps push yields lower.
Connors sees further policy moves as potential catalysts for Bitcoin's growth, including changes to the supplementary leverage ratio. He believes this could give banks more room to absorb government bonds and ease yield pressure further, leading to a price target of $180,000 for Bitcoin.