Treasury Intervention Fuels Bitcoin Surge as Institutional Investors Return

The price of Bitcoin surged to $77,580 on August 20, representing a 13.2% increase in just 24 hours. Ethereum also rose significantly, reaching $2,388 after breaking through the $2,000 barrier it had been stuck at since July.

According to experts, several factors contributed to this rapid price jump. Firstly, the US Treasury announced that it would double its long-dated bond buybacks from $2 billion to at least $4 billion per operation, starting September 9. This move is seen as a sign of the government's willingness to intervene in the market and keep long-term yields low.

Secondly, institutional investors returned to the crypto market, with US spot Bitcoin ETFs taking in $517 million on August 19 and $606 million on August 20. Ethereum funds also saw significant inflows of $221 million on the same day.

Lastly, bearish positions were liquidated, resulting in a record loss of $2.7 billion for short sellers. This forced buying can move prices violently but is not necessarily indicative of genuine market demand.