The cryptocurrency market is experiencing one of the most striking surges in recent months. The leading cryptocurrency has gained about 29% in just under two weeks, jumping from $63,000 to $81,000, and on August 25 it updated its three-month high. This movement makes investors wonder: are we seeing the start of a sustainable bull trend or just a temporary overheating?
At the core of this rally lies not just speculative hype, but a convergence of several fundamental factors at once. The key trigger was the weakening of the US dollar amid statements by Treasury Secretary Scott Bessent about plans to stabilize the bond market. This move restored risk appetite across the crypto sector, and bitcoin began to be viewed again as a protective asset capable of surviving the devaluation of fiat currencies.
What drives the price of bitcoin
The value of BTC is shaped by a complex system of factors. The macroeconomic environment remains dominant: low rates and growth in the global money supply traditionally support digital gold, while tighter Fed policy, on the contrary, weighs on risky assets. However, now we are also seeing a powerful institutional signal.
In the week from August 17 to 24, net inflows into spot bitcoin ETFs totaled about $2 billion — the highest figure in three months. Notably, just a week earlier, outflows of $4 billion were recorded. Such a rapid reversal in sentiment among large funds suggests that managers are promptly revising their models in favor of monetary policy easing and further dollar weakness.
The Treasury effect and the "debasement trade"
The decision by the US Treasury to expand its buyback program for long-term government bonds added confidence to the market. Monthly buyback volumes will increase to $4 billion for securities with maturities from 10 to 30 years. This happened against the backdrop of 30-year bond yields rising to 5.34% — the highest level since 2007. Although $14 billion in additional liquidity is a drop in the ocean compared to $32.2 trillion in national debt, the very signal of the state's readiness to contain long-term rates proved extremely important.
This revived the so-called "debasement trade" — a strategy of buying hard assets like gold, silver, and bitcoin in anticipation of fiat currency devaluation. The weakening dollar and the simultaneous rise of gold to a three-month high only confirm this shift.
Technical picture and risks
Technical factors should not be dismissed either. The price rise triggered a massive liquidation of short positions — about $7 billion worth of such positions were closed across all crypto assets over the week. The snowball effect, where forced short covering leads to purchases and further growth, became an additional accelerator.
However, the sustainability of the current move remains in question. Low trading volume above $80,000 makes the asset vulnerable to sharp swings in both directions. The key technical level remains the $80,000–$83,000 range. If the price consolidates above it, we can talk about a trend change and continued growth. The most likely scenario for the coming days looks like stabilization in the $70,000–$80,000 corridor — the market needs a pause to "digest" such a rapid impulse.
My view: Despite the powerful signal, I remain cautious. Institutional inflows are a positive sign, but the market is still thin at the upper levels, and any negative news from Washington could trigger a reverse wave of liquidations. Investors should closely monitor macroeconomic data and Fed actions without succumbing to euphoria.