BlockBeats report: On August 22, after the U.S. Treasury expanded its long-term Treasury buyback program, the 30-year U.S. Treasury yield fell from a 19-year high of 5.34% to approximately 5.19%, while Bitcoin rose about 25% over several days, briefly surpassing $79,000. During this period, approximately $4 billion in cryptocurrency short positions were liquidated, further amplifying the upward momentum.
The U.S. Treasury previously announced an increase in the size of its longest-dated Treasury buyback operations from $2 billion per operation to $4 billion. Analysts note that this operation is not equivalent to the Federal Reserve’s quantitative easing (QE); its primary purpose is to improve liquidity in older securities and optimize the debt structure. However, the market views it as a policy signal supporting longer-dated U.S. Treasury yields.
Analysis suggests that the key driver behind this Bitcoin surge was not the buyback itself, but the excessive concentration of short positions in the market. As long-term U.S. Treasury yields declined, short sellers were forced to cover their positions, triggering a powerful short squeeze.
Meanwhile, U.S. spot Bitcoin ETFs saw net inflows of approximately $650 million this week, and Trump again urged Congress to advance the CLARITY Act, further boosting market risk appetite.
Jeff Ko, Chief Analyst at CoinEx, stated that the key now is whether Bitcoin can hold the 200-day moving average around $69,000 and transform it from resistance to support. Market participants also warn that if the 10-year U.S. Treasury yield rises back above 4.7% and the 30-year yield approaches 5.3%, Bitcoin’s current breakout could face renewed pressure.
Bitcoin has now broken above the 200-day moving average and continues to rise; the next phase of the market will focus on whether it can sustain its upward momentum in a high-yield environment.