Key facts
- Bitcoin surpassed $80,000, reaching its highest level since mid-May.
- The cryptocurrency has gained 16% following President Trump's call for crypto regulation clarity.
- U.S. Treasury plans to buy back long-dated bonds, contributing to dollar weakness.
- Concerns over currency debasement have resurfaced, benefiting digital assets.
- Bitcoin is on track for its largest monthly gain since November 2024, up 28% in August.
- Gold prices also hit a three-month high, reaching $4,651 an ounce.
Bitcoin surged past $80,000 on Tuesday, reaching its highest point in over three months, fueled by a weakening U.S. dollar and renewed fears of currency debasement. The cryptocurrency has seen significant momentum, gaining 16% since U.S. President Donald Trump last week urged Congress to establish clearer definitions for the cryptocurrency sector.
Bitcoin was trading at $80,323.24 in Asian hours, after earlier touching $81,237.94. The digital asset is up 28% for August, positioning it for its largest monthly gain since November 2024. This rally follows the U.S. Treasury's announcement of plans to repurchase more long-dated bonds, a move intended to curb gains in long-term yields, which has consequently placed pressure on the U.S. dollar.
Analysts suggest that the Treasury's actions are precisely the kind of events Bitcoin was designed to help investors circumvent. The Treasury announcement has intensified discussions around the 'debasement trade,' where efforts to cap bond yields through buybacks shift pressure to the currency market. This prompted a scramble into physical and digital assets as debasement fears resurfaced, suggesting that a sustained break above current levels could propel Bitcoin towards $95,000–$100,000.
Gold prices also hit a three-month high, reaching $4,696.18 an ounce, driven by Middle East conflict and political uncertainty. The precious metal has risen about 15% in August, on track for its best monthly performance since September 1999. Global gold-backed exchange-traded funds recorded $3 billion in net inflows in July, reversing two consecutive months of outflows. Markets have largely priced out a September Fed hike as softer data has eased concerns about further tightening.