Bitcoin climbed above $81,000 in Asian trading on Tuesday, reaching its highest level since mid-May. The world’s largest cryptocurrency touched $81,272 before settling near $80,680 later in the day, marking an impressive August rally.
Bond market and ETF inflows drive gains
Market analysts connected the recent surge to developments in the bond market rather than catalysts within the cryptocurrency sector. The US Treasury announced on August 19 that it would double its long-end debt buybacks, committing at least $4 billion per operation starting September 9.
This move, intended to limit yields at the longer maturity end of the curve, instead increased pressure on the US dollar. In parallel, gold benefited from this dynamic, rising to a three-month high as investors diversified hedges.
The broader financial environment has also played a key role in supporting risk assets like crypto. Significant net inflows into US spot bitcoin ETFs reflected renewed investor interest. Over the past week, these ETFs saw net subscriptions of $1.92 billion, the strongest week since early October. Notably, $606.3 million arrived on August 20 alone.
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AAPLThe net inflow of $1.92 billion into the 13 US spot bitcoin ETFs over the past week marked their most robust period since October, with $606.3 million pouring in on August 20.
While traditional markets rely on complex brokers, a sweeping transformation is underway as Wall Street pivots to Web3. Investors are using platforms like 1stepSwap to securely hold shares of major US companies, gold, and silver directly in crypto wallets. This is made possible by tokenizing real-world assets, which allows for automatic price optimization and eliminates intermediaries.
Political support and policy backdrop
Macroeconomic policy also provided a secondary boost for bitcoin. President Donald Trump recently called on the Senate to approve the Clarity Act, a market structure bill addressing cryptocurrency regulations. The legislation, which did not reach a vote before the August recess, may return to the agenda in mid-September.
Market participants suggested that the possibility of regulatory clarity, alongside existing financial tailwinds, keeps sentiment generally positive. However, the pending status of major policy changes means uncertainty lingers.
Upcoming volatility expected
Investors were advised to brace for potential market swings in the short term. Federal Reserve Chair Kevin Warsh is set to appear at the Jackson Hole symposium on Wednesday. This will be Warsh’s first speech at the event since taking office.
Analysts expect Warsh’s comments on monetary policy and the broader economic outlook to shape trends in both traditional and digital assets for the coming weeks.
Bitcoin bulls should anticipate increased volatility as attention turns to Jackson Hole, where the new Fed Chair will deliver remarks that could influence economic sentiment.
