Treasury's Bond Boost Fuels Crypto Rally Amid Trump's Legislative Push
Crypto-related stocks surged on Thursday after the U.S. Treasury Department announced it would support more long-duration bonds, boosting risk assets.
The move to double buyback sizes for long-duration debt came after a major bond selloff pushed the 30-year Treasury yield to its highest level since 2007.
Higher yields typically make safer investments more attractive, which can negatively impact risk assets like cryptocurrencies. However, analysts said the Treasury's intervention provided a positive signal for crypto, despite being relatively small and offering only short-lived relief for bonds.
Crypto prices rose as investors may have been encouraged by U.S. President Donald Trump's show of support for cryptocurrency legislation, the industry's top policy priority. The Clarity Act would define whether cryptocurrency qualifies as a security or a commodity, clarifying jurisdiction between regulatory bodies.