Will Bitcoin Sustain its 22% Rally Amid Treasury Liquidity Boost

Bitcoin's recent surge to a 22% price increase has analysts weighing in on whether it will be sustained. The breakout week was initially driven by the U.S. Treasury's decision to expand buybacks of longer-dated government debt, which pushed long-term yields lower and weakened the dollar.

Fabian Dori, chief investment officer at Sygnum, noted that Bitcoin's behavior alongside other markets suggests a strong macro component in the initial rally. He pointed out that investors seeking hard assets amid renewed concerns about currency debasement drove demand for gold and Bitcoin.

However, analysts argue that the staying power of the rally will depend on whether ETF inflows and spot demand can replace the initial macro boost. The continued inflows into U.S. spot Bitcoin exchange-traded funds are a positive sign, attracting around $2.8 billion over eight consecutive sessions.