Treasury Turmoil Sends Bitcoin, Gold Soaring Amid Crypto-Friendly Washington

The bond market turmoil and Washington's crypto-friendly moves propelled Bitcoin and gold to new heights this week.

Bitcoin, which had dropped from a January high of around $95,000 to below $60,000 in June, rose above $77,000 on Friday. Gold, which hit a high above $5,300 in January but dropped to around $4,000 in June due to rising interest rates, rose to $4,661 on the same day.

The Treasury Department's announcement to significantly increase its buybacks of long-term Treasurys sent shockwaves through the market. This move was intended to calm bond markets after a sustained sell-off, but it also raised questions about whether the government is trying to push borrowing costs lower despite inflationary pressures.

Treasury Secretary Scott Bessent's maneuver could potentially handcuff the Federal Reserve, which fights inflation by raising interest rates. The national debt surpassed $40 trillion on the same day as the Treasury's actions unfolded.