Over the past few days, Bitcoin has made an impressive surge, breaking through the $70,000 mark and then piercing the psychological level of $80,000. The rise amounted to more than 13% in a short period, triggering around $3 billion in liquidations of short positions. Many investors are asking: what was the real catalyst for this move? The answer lies not in the crypto industry, but in the actions of the U.S. Department of the Treasury.
The Mechanics of the Rise: The Role of the TGA and the Bond Market
The key trigger was the U.S. Treasury's decision to double the volume of long-term bond buybacks, using funds from the Treasury General Account (TGA), which currently holds around $950 billion. This step was taken against the backdrop of 10-year yields rising to 4.7% and 30-year yields above 5.2%, which created excessive pressure on the entire financial system.
The mechanism is simple but effective: active bond buybacks raise their price and lower yields. After the announcement of the possible use of the TGA, the 10-year Treasury yield fell from ~4.74% to ~4.71%, and the 30-year from ~5.28% to ~5.24%. At first glance, these are minor changes, but the bond market is valued at $32 trillion, so even such a move noticeably changes the cost of money in the economy.
When the Treasury uses the TGA more actively, funds return from the Fed to bondholders—banks, funds, and investors—increasing liquidity in the system. In terms of its impact on yields, this decision resembles a quantitative easing (QE) program, although the implementation mechanism differs. Such liquidity reaches the crypto market last, primarily through exchange-traded funds, but the effect proved to be lightning-fast.
Inflows into ETFs and Key Levels
Bitcoin's reaction was expected: from August 17 to 21, spot Bitcoin ETFs in the U.S. received about $1.9 billion in net inflows, with all five trading days positive. For comparison, moving the price from $79,000 to $90,000 requires $3-5 billion in sustained demand, and reaching $100,000 would already require about $5 billion. Thus, the weekly inflow already constitutes a significant portion of the required amount.
Bitcoin holds about 59% of the market capitalization and sets the direction for all altcoins. The key range right now is $73,000-75,000, where many new investors opened positions. As long as the price stays above this level, recent buyers have fewer reasons for panic selling. If Bitcoin falls below $73,000, pressure will begin to build, and a test of $70,000 would become even more dangerous.
My working scenario for the coming week: a range of $75,000-81,000. The zone around $80,000 is a historical "price imbalance zone," where few volumes and open positions have accumulated, so the market often returns to fill this gap. The local high of the move is $83,000-85,000. A sudden surge to $100,000 (+27% from current levels) is unlikely without a new influx of liquidity or a catalyst for mass liquidations.
For Ethereum, the logic is similar: the coin rose 29% over the week and is trading around $2,500. Resistance is at $2,600-2,700, but after such a strong weekly gain, I am not opening long positions. The $2,200 zone is more interesting for a pullback, where one could look for a local long targeting $2,600-2,700. Weekly inflows into Ethereum ETFs amounted to about $697 million, but their sustainability is still in question.
My expert view: the actions of the U.S. Treasury are not a one-off episode but part of a broader liquidity management strategy. If the TGA continues to be used more actively, we will see not just a correction but the formation of a new upward structure. However, without a close above $85,000, it is premature to talk about a full-fledged bull trend. Watch Kevin Warsh's speech on Friday and the PCE index data—they could be the next catalyst.