Bitcoin rises above $80,000 as soft dollar, debasement fears boost momentum

Bitcoin has surpassed the $80,000 mark, achieving its highest level in over three months, as a weakening U.S. dollar and concerns about currency debasement have injected fresh momentum into the cryptocurrency sector. The digital asset was last trading at $80,323.24 in Asian hours, after touching an earlier peak of $81,237.94, levels not seen since mid-May.

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That would create a relatively supportive macro backdrop for assets such as bitcoin and gold.

This surge follows recent encouragement from U.S. President Donald Trump, who urged Congress to pass legislation that would provide clearer definitions for the burgeoning cryptocurrency industry. Since Trump's statement last week, Bitcoin, the world's largest cryptocurrency by market capitalization, has climbed an impressive 16 percent. The digital currency is on track for its most significant monthly gain since November 2024, having already risen 28 percent in August.

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The Treasury announcement is “exactly the type of thing bitcoin loves”, adding that bitcoin was built to allow investors a way to avoid this type of intervention.

The positive trend in cryptocurrencies has been further bolstered by the U.S. Treasury's announcement of plans to buy back more long-dated bonds. This move aims to curb the rise in long-term yields, a strategy that has placed considerable pressure on the U.S. dollar. Tim Sun, senior researcher at HashKey Group, noted that Treasury Secretary Scott Bessent's messaging suggests a potentially lower tolerance for rising long-end yields through the midterm elections, creating a supportive macroeconomic environment for assets like Bitcoin and gold.

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This (Treasury announcement) prompted buyers to scramble into physical and digital assets as debasement trade fears re-emerged.

Geoff Kendrick, global head of digital assets research at Standard Chartered, commented that the Treasury's announcement is precisely the kind of development Bitcoin thrives on, as it was designed to offer investors a way to circumvent such interventions. The action has intensified discussions around the "debasement trade," where efforts to cap long-end yields through buybacks shift pressure from the bond market to the currency market. Market analyst Tony Sycamore of IG stated that this situation prompted buyers to flock to physical and digital assets as fears of currency debasement resurfaced. He added that a sustained break above the current resistance level could pave the way for Bitcoin to reach $95,000 and potentially $100,000.

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A sustained break above here would open the door for a move towards $95,000 and $100,000.