Treasury Buybacks Spark $81,240 Bitcoin Surge

The US Treasury's decision to double its long-dated bond buyback operations in mid-August sparked a Bitcoin price surge, reaching $81,240 by August 24.

The move, announced on August 19, saw the maximum size of liquidity support buyback operations for bonds in the 10-20 year and 20-30 year maturity sectors doubled from $2 billion to at least $4 billion.

This change in bond market dynamics compressed yields by 15 basis points, triggering a chain reaction that reached every leveraged position in digital assets.

The resulting short liquidations totaled $3.5 billion across major exchanges between August 19 and 22, making it the second-largest short squeeze event on record.