Bitcoin jumps 20% in a week as Treasury signals bigger bond buybacks
Bitcoin (BTC) posted its best week since 2024, rising about 20% in seven days and trading above $75,000 after spending much of the prior two weeks below $65,000. The catalyst was a U.S. Treasury announcement rather than an ETF headline.
On Wednesday, Treasury Secretary Scott Bessent doubled long-duration bond buybacks from $2B to at least $4B per operation, with execution starting September 9 through November 4. The surprise timing pushed long-bond yields sharply lower within minutes, then partly retraced the next day.
Crypto’s reaction came through positioning. Traders who had shorted Bitcoin and expected tighter conditions were squeezed: roughly $3B in short positions were liquidated over the following day, and forced buying helped lift BTC even as bond yields stabilized.
Market sentiment flipped quickly. The Fear & Greed Index jumped from 46 to 62 in one day and reached 72 by Friday. Funding rates for perpetuals hit a 20-month high, suggesting leverage increased alongside the rally.
Supportive data cited included: large holders adding BTC over the past two months, positive spot and futures demand on a 30-day basis for the first time in months, and spot BTC ETF flows turning positive again in July and early August.
However, some analysts warn the move may be momentum-driven rather than conviction-based because it shifted before slower data could confirm. Traders are likely to watch whether BTC funding cools while price holds.
Key takeaway for traders: Bitcoin’s rebound is being amplified by macro signaling and leverage dynamics, so volatility risk remains high even if the trend looks bullish.
Bullish
The news is broadly bullish for BTC in the immediate term because it triggered a large, fast short liquidation chain ($~3B) and a sharp shift in sentiment (Fear & Greed 46→72), which can sustain upward momentum. The macro element (Treasury bond buyback signaling via Scott Bessent) worked more as a “trigger” than as actual liquidity—yet the market repriced quickly before any cash was spent.
However, the article also flags a key risk: funding rates are at a 20-month high, which often means the rally is increasingly reliant on leverage. In past cycles, when funding spikes while conviction is still developing, sharp pullbacks have followed once shorts/late longs unwind.
Short term: expect continued volatility and potential follow-through if funding stabilizes and ETF/spot demand remains positive.
Long term: the direction depends on whether the current momentum converts into sustained spot demand (and whether funding cools). If the buyback narrative fades while leverage stays elevated, upside may cap and reversals become more likely.