Treasury's Bond Market Move Sparks Global Rally, Including Record-Breaking Crypto Surge
The recent surge in Bitcoin's price has been attributed to various factors, but experts say it's not just about crypto news. A closer look reveals that a technical decision by the US Treasury had a ripple effect across global markets.
The US Treasury doubled its long-dated debt buybacks from $2 billion to at least $4 billion per operation, pulling down the 30-year yield from around 5.34% to roughly 5.2%. This move sent shockwaves through risk assets, including Bitcoin, gold, silver, and US equities.
The bond market was the catalyst for this rally, not a surge in demand for crypto. Long-term Treasury yields decide how every other asset gets priced, and when it moves sharply, assets like Bitcoin and gold reprice almost in unison.
A record short squeeze wiped out over $1.1 billion in short positions in a single day, but a meaningful chunk of this rally was mechanical. The question now is whether demand will sustain the move or if it's just a one-day event.