Bitcoin Tops $80,000 for First Time in Three Months as Treasury Doubles Bond Buybacks
Bitcoin traded above $80,000 on Tuesday for the first time in more than three months, briefly touching $81,257 before easing back to around $78,800 in afternoon trading. The move capped a 28% gain for the month and pushed the coin to its highest level since mid-May, and the catalyst wasn’t a crypto headline at all — it was a change to how the U.S. government manages its own debt.
On August 19, Treasury Secretary Scott Bessent announced that the department would double the maximum size of its long-term bond buyback operations. Purchases in the 10-to-20-year and 20-to-30-year maturity buckets will rise from a $2 billion cap to at least $4 billion per operation, starting September 9 and running through the November 4 refunding quarter. The stated goal was to support liquidity in a Treasury market that had been under strain, with the 30-year yield sitting near a multi-year high above 5.3% and long-dated debt costs climbing across the board.
The bond market reacted almost immediately. The 30-year yield slid from near 5.34% to roughly 5.19%-5.20%, while the 10-year eased about six basis points to close to 4.65%. Bitcoin moved just as fast: within hours of the announcement it jumped around 8.7%, climbing from about $64,000 toward the $69,750-$71,000 range as traders read the buyback expansion as an early, quiet form of liquidity support for risk assets generally.
The rally didn’t stop there. Days later, two senior Treasury officials told reporters that the department was also weighing whether to tap its roughly $950 billion cash balance held at the Federal Reserve — the Treasury General Account — to fund even larger buyback operations. That prospect, effectively a second lever the government could pull to keep long-term borrowing costs down, added fuel to a market already pricing in easier financial conditions. A soft U.S. dollar and improving odds that Congress will eventually pass crypto market-structure legislation, following a White House meeting between the president and executives from major exchanges, added further tailwinds.
Not everyone is convinced the strategy is as benign as a routine liquidity operation. Legendary macro investor Stanley Druckenmiller, Bessent’s own former boss, has publicly criticized the plan, arguing in a recent op-ed that doubling long-dated buybacks risks crossing the line from managing market function into outright yield suppression — language that echoes older debates about central banks propping up bond prices. Whether that criticism gains traction in Washington remains to be seen, but for now the trade has worked: short sellers who spent weeks betting against Bitcoin were forced to cover, and every leg up in price triggered another round of buying.
Bitcoin remains well below its October peak near $126,000, and the government has not confirmed it will actually draw on the Treasury General Account, only that officials are discussing the option. Whether the Treasury’s buyback expansion turns into a durable tailwind or a one-off squeeze will likely depend on what happens to yields once the September operations actually begin.
Crypto assets remain highly volatile and macro-driven moves like this one can reverse quickly; nothing here is financial advice. Readers new to how monetary and fiscal policy feed into crypto markets can start with the Bitcoin Academy.