U.S. Treasury Buyback Looms: Will Bitcoin's Rally Continue? Falling Treasury Yields Drive Bitcoin Higher

Recently, the correlation between stocks and Bitcoin has been moving in reverse, and this is becoming more pronounced. The analysis attributes this to falling U.S. Treasury yields benefiting stocks while Bitcoin moves opposite to stocks as a dollar hedge position. Editor-in-chief Park Sang-hyuk stressed the importance of this trend, saying, "Honestly, the correlation between these stocks and this Bitcoin is now moving in reverse, and that seems very important."

Falling international oil prices are pulling Treasury yields lower, which eases inflationary pressure and raises expectations that the Federal Reserve (Fed) will hold or cut rates. Editor-in-chief Park Sang-hyuk explained, "A Treasury yield decline driven by easing inflation is a healthy one. I think that's the important point."

The Conference Board's consumer confidence index for August came in at 89.4, down from 90.2 the previous month. This signals concern about slowing consumption and is acting as a factor limiting stock gains. Bitcoin is also affected by consumption concerns but is showing resilience in limiting its declines. Editor-in-chief Park Sang-hyuk noted, "The Conference Board's August consumer confidence index came in at 89.4, below the prior month's 90.2, which means consumption has slowed."

Lifting U.S. sanctions and the blockade are being cited as preconditions for a ceasefire. While this is positive news that could push international oil prices lower, the likelihood of the U.S. accepting the proposal remains uncertain, which may limit the upside. Editor-in-chief Park Sang-hyuk explained, "Pakistan's Chief of Army Staff spent two days in Iran meeting all the key figures, and the proposal is to return to the ceasefire framework we were thinking about in June."

He argued that it is inappropriate for the Treasury to artificially intervene in the bond market without efforts to resolve the fiscal deficit. Druckenmiller contends that Treasury yields should fall naturally through a recovery in fiscal health, and he expressed concern about the policy, citing his mentor relationship with the Treasury Secretary. Editor-in-chief Park Sang-hyuk relayed Druckenmiller's position, saying, "The Treasury is about to do a buyback and has already announced it for September, but this shouldn't be done this way. We need to move toward resolving the fiscal deficit—a healthy decline in Treasury yields happens that way, not when the government artificially intervenes in the bond market like this."

In a published op-ed, Druckenmiller warned that U.S. national debt is rising too rapidly. He pointed out that debt surged after the 2008 financial crisis through the quantitative easing era and recently topped $40 trillion. He criticized the Treasury and the Federal Reserve for excessive intervention in the bond market, citing the historical case of 1940s wartime government intervention that led to inflation, and expressed concern about the current situation. Editor-in-chief Park Sang-hyuk explained, "The fundamental reason Druckenmiller wrote this piece is that U.S. national debt is climbing too quickly. Since the quantitative easing era began after the 2008 crisis, it has been moving very sharply, and recently it became a talking point when it passed $40 trillion."

A growth-based approach is being proposed as a solution to U.S. national debt. Like the British case, where the Industrial Revolution offset debt from the Napoleonic Wars, Treasury Secretary Bessent recently said in an interview that growth driven by artificial intelligence (AI) could offset U.S. national debt. However, it remains unknown whether AI will have an impact comparable to the Industrial Revolution, and analysts say the current administration's record-low approval rating could also hinder large-scale policy efforts. Editor-in-chief Park Sang-hyuk noted, "In Britain's case, growth offset the debt once the Industrial Revolution arrived. Treasury Secretary Bessent, in an interview a few days ago, said he would offset U.S. national debt with growth and brought up AI. But whether this AI is on the scale of the Industrial Revolution, we don't know yet."

Most experts expect the U.S. Treasury's buyback to proceed in September. If the buyback succeeds and stabilizes Treasury yields, it would be a positive catalyst for the broader risk asset market, including Bitcoin. However, if the buyback fails and real rates and the dollar rise together, this could be a very serious negative for Bitcoin. Accordingly, the outcome of the September buyback is expected to be an important turning point determining the direction of Bitcoin and risk assets overall. Editor-in-chief Park Sang-hyuk laid out the market impact scenarios, saying, "The dominant view among experts is that it will happen in September. If the buyback succeeds and Treasury yields calm down, that would likely be a positive for all risk assets, not just Bitcoin. If the buyback fails and real rates and the dollar rise together, that's very bad for Bitcoin."

This movement is interpreted as linked to rising net inflows into U.S. spot ETFs. The Coinbase premium turning positive is read as a strong signal that U.S. investors' buying demand is intensifying. Editor-in-chief Park Sang-hyuk explained, "The Coinbase premium has actually turned positive—back in positive territory after about three months. There were net inflows yesterday too, and I think this is reflected in the premium indicator showing a positive reading."

This band is where investors' average purchase costs are most concentrated, so it is interpreted as a strong resistance level where a significant volume of supply could act as selling pressure. Editor-in-chief Park Sang-hyuk emphasized the importance of this range, saying, "The range with the highest realized price right now is between $80,000 and $90,000."

Many investors have now entered profitable territory, and those in profit tend to hold off rather than buy more. This suggests that sustained market gains will require fresh buying demand. Editor-in-chief Park Sang-hyuk analyzed investor sentiment, saying, "If this many people are in profit, will it keep going up? In the end, someone has to buy for it to rise, but people who are already profitable don't buy more."

As Bitcoin's price rises, investors are increasingly torn over whether to buy Bitcoin directly or shares of Bitcoin-related companies such as MicroStrategy (MSTR). Editor-in-chief Park Sang-hyuk noted that he has been asked "should I buy Bitcoin or Strategy?" more than ten times, indicating that such inquiries have grown sharply.

Shares of digital asset companies have risen sharply alongside Bitcoin. MicroStrategy is up 26.3% over the past week, MetaPlanet is up 49.3%, and BitMine is up 32%, showing broad gains across major firms. However, these shares remain down about 60% from a year ago, so further gains are needed for a meaningful long-term recovery. Editor-in-chief Park Sang-hyuk cited the specific gains, saying, "Strategy is up 26.3% from a week ago. MetaPlanet is up 49.3%, and BitMine is up 32%."

It must first successfully absorb the supply zone that has formed in the $80,000–$90,000 range. If Bitcoin's price clears $100,000, digital asset treasury (DAT) companies such as MicroStrategy are expected to see even stronger upward momentum in their shares. Editor-in-chief Park Sang-hyuk forecast, "Once it's above $100,000 and a full bull market begins, I think DAT companies will get a bit of a booster."

Editor-in-chief Park Sang-hyuk quoted Bier's remarks, saying, "Solana, I think, will introduce a feature that lets you trade digital assets like Ethereum on X."

In other words, the argument is that government fiscal policy helped relatively raise the value of digital assets such as Bitcoin. Editor-in-chief Park Sang-hyuk explained this hypothesis, saying, "Because the Treasury announced it would buy back Treasuries and dilute the dollar's value, the bull market has started."

One of the main reasons Bitcoin has outperformed gold is market anticipation of regulatory clarity (the "Clarity" act) for crypto. This suggests the prospect of Bitcoin being gradually integrated into institutional assets is already being priced in. Other hypotheses also exist in the market, and how changes in the regulatory environment will affect Bitcoin's price remains something to watch closely. Editor-in-chief Park Sang-hyuk stressed this factor, saying, "Expectations for Clarity have really picked up."

Solana rose 22% over the past week, but on-chain data analysis shows that the main driver of its rally was a surge in meme coin trading volume. Trading volume on decentralized exchanges (DEX) and perpetual futures also increased, but the meme coin-led rally has raised concerns about long-term growth momentum. Some argue Solana needs to present a new vision and use cases beyond meme coins to sustain growth. Editor-in-chief Park Sang-hyuk explained the source of Solana's rally, saying, "One key data point is that meme coins built on Solana had very high trading volume."