Bitunix Analyst Says Treasury Bond Buybacks, Fed Inflation Stance Drive Nearly 20% BTC Rally

On Aug. 21, a Bitunix analyst said the U.S. Treasury has been using larger buybacks of long-dated Treasurys to stabilize the bond market, with Treasury Secretary Bessent saying a single repurchase could exceed $4 billion. That shows the government is paying closer attention to long-end funding costs. Fed officials have not moved in the same direction. Daly said there is still no evidence that would justify an early rate hike, while Musalem said moving sooner could help avoid a more aggressive tightening later. The Treasury wants to push long-term yields lower; the Fed is still trying to keep financial conditions from getting too loose. The policy tension is widening. The drop in yields tied to the buybacks did not last. Long-end Treasury yields quickly moved higher again, which suggests the market is still trading the $40 trillion debt load, an almost 6% fiscal deficit, heavy government funding needs and term premium rather than one buyback program. Treasury action can help short-term liquidity and sentiment, but it cannot change the structural pressure from long-term debt supply on its own. That backdrop is now showing up across currencies and risk assets. Citi cut its dollar forecast, saying expectations for a dovish Fed and Treasury buybacks should pressure the greenback. With the dollar softer, gold has kept rising, while BTC has climbed about 19.9% since Monday to around $75,400. Over the past 24 hours, BTC short liquidations reached $1.08 billion, creating a clear short squeeze. Crypto ETFs also posted about $859 million in net inflows, including $606 million into BTC ETFs and $220 million into ETH ETFs. That suggests the move is not just short covering; spot money is also coming back in. For now, the key question for BTC is not simply whether the Fed cuts or hikes. It is whether the current mix of dollar weakness, Treasury yields and liquidity can hold. If long-end yields stay capped by Treasury operations, the dollar keeps weakening and ETF inflows continue, BTC could keep its momentum. If debt pressure and inflation push term premium higher again and force tighter Fed policy, crypto’s high-beta rally could face a new round of repricing.