Bitcoin rose to its highest level since early June, trading above $69,800 on Wednesday, after the U.S. Treasury announced plans to increase buybacks of long-dated bonds. The move eased pressure on the beleaguered bond market, where 30-year Treasury yields had earlier surged to levels not seen since 2007 amid concerns over inflation, geopolitical risks from the Iran conflict, rising U.S. debt levels and heavy capital demands from major AI firms.
The Treasury’s decision to boost purchases of long-term debt helped push yields lower, making non-yielding assets like Bitcoin more attractive to investors. Analysts noted that the shift alleviated some of the strain on fixed-income markets, where rising yields had previously weighed on risk appetite. "The latest measure takes pressure off the recently tense bond market," said Timo Emden, chief market analyst at Captrader. "Investors in crypto see more than a glimmer of hope in the otherwise gloomy market outlook and are returning to riskier assets."
Political expectations also contributed to the rally in digital assets. Emden added that investors anticipate Bitcoin and other cryptocurrencies may regain prominence on U.S. policy agendas ahead of the November elections, potentially leading to a more favorable regulatory environment.
Gold prices followed a similar trajectory, climbing to their highest level since early June at over $2,480 per troy ounce on Wednesday. The precious metal benefited from the decline in U.S. yields and a softer dollar, which increased its appeal to non-dollar investors. However, gold pared some gains on Thursday, falling 0.9% to $2,440 per ounce.
The recent stabilization in oil prices, despite ongoing geopolitical tensions in the Strait of Hormuz, also played a role in reducing volatility across risk assets. Earlier concerns over higher interest rates had weighed on Bitcoin and other speculative investments, as rising borrowing costs typically discourage allocations to higher-risk assets.
