The impressive surge of the first cryptocurrency over the past two weeks deserves the closest attention. Bitcoin has demonstrated growth of nearly 29%, rising from $63,000 to $81,000 and updating its three-month high from August 25. This is not just another volatile spike, but a signal of a shift in the market paradigm, where several fundamental factors have intertwined.
Key drivers of the rally: from Fed policy to the "debasement trade"
The main catalyst for this movement was the weakening of the US dollar amid statements by Treasury Secretary Scott Bessent about plans to stabilize the bond market. The market perceived this as a signal of the authorities' readiness to curb the rise in long-term yields, which restored risk appetite across all asset classes, including cryptocurrencies.
However, the current growth has a deeper foundation than just a reaction to political statements. We are witnessing a revival of the so-called "debasement trade" — a strategy based on expectations of fiat currency depreciation due to rising government debt, budget deficits, and inflation. Investors are actively buying "hard" assets — gold, silver, and bitcoin — while simultaneously shedding traditional "safe" instruments such as government bonds. The fact that gold simultaneously updated its three-month highs only confirms this global shift.
It is important to understand that the Treasury buyback program announced by Bessent is not quantitative easing in the classical sense. It is financed through the issuance of short-term bills and does not directly expand the money supply. Nevertheless, the very signal of the state's readiness to curb long-term rates has created an extremely favorable macroeconomic backdrop for risk assets.
Institutional flows and political signals
Special attention deserves the reversal of institutional flows. For the week from August 17 to 24, net inflows into spot bitcoin ETFs amounted to about $2 billion, reaching a three-month high. This is especially telling against the backdrop of $4 billion in outflows the week earlier. Such a rapid shift in sentiment among large portfolio managers suggests that they are quickly incorporating scenarios of further monetary policy easing and dollar weakening into their models.
Signals from the political summit added momentum. The US President's calls for Congress to pass a clearer law on cryptocurrency regulation, as well as his meeting with industry representatives, where he spoke in favor of a "fair version" of the regulatory clarity law, reduce regulatory uncertainty. This opens the door for even larger institutional capital that had previously remained on the sidelines.
Technical picture and correction risks
Despite the powerful momentum, I also see weaknesses in this rally. A significant portion of the growth was driven by a snowball effect from short position liquidations — over the week, about $7 billion of such positions were closed across all crypto assets. This creates a risk of reversal if negative news emerges.
The key technical level remains the $80,000–$83,000 range. If bitcoin can consolidate above it, one could speak of a trend change. However, low trading volume at these heights makes the asset vulnerable to sharp movements in both directions. The most likely scenario for the coming days, in my view, is stabilization in the $70,000–$80,000 range, which will allow the market to "digest" such rapid growth.
My conclusion: We are entering a phase where macroeconomic factors will dominate over the intraday technical picture. Investors should closely monitor any signals from the Fed and new interventions by the Treasury — these will determine whether bitcoin can hold its gained positions or whether we will see a deep correction before the next push.