Bitcoin rose sharply last week, and prices rose by about 22 per cent in a week. The breakout was initially driven more by macro-liquidation changes. Following the announcement by the United States Treasury Department of an expansion of long-term government debt buy-backs, long-term United States debt yields have fallen, the United States dollar has weakened and gold has grown in step with bitcoin.

The Chief Investment Officer, Sygnum Fabian Dori, and the Director of DWF Labs Market Research, Martin Lee, indicated to crypto.news that the round was not entirely from inside the encrypted market. The early driving forces are more like macro-trading, followed by a gradual overlay of ETF financial flows and encrypted market demand itself.

The Treasury's repurchases are pushing up the mood.

On 19 August, the United States Treasury Department indicated that it would at least double the ceiling on nominal government debt support for the 10- to 20- to 30-year period, from $2 billion to at least $4 billion per operation. The new arrangements will be implemented from 9 September and will continue until the end of the current refinancing quarter.

According to Dori, this expression of short-term pressure lowers long-term rates of return and rekindles market concerns about currency devaluation. Against this background, the flow of funds to “hard assets”, such as gold and bitcoin, illustrates the obvious macro-characteristic character of the rise in the first round of bitcoin.

Martin Lee also mentioned that technology and AI assets were still under pressure at the time, but that gold and bitcoin ETF received inflows of funds, indicating that market risk preferences were not a general upturn, but rather transactions that tended more in the face of a downward trend in the purchasing power of hedge currencies.

ETF works with empty headbacks

In addition to macro-level factors, derivatives data indicate that this round rise is accompanied by a clear recovery. Lee states that after Bitcoin broke through the pre-shock zone, approximately $2.7 billion of empty warehouse space in the encryption market was liquidated, and that some of the apparent purchases came from empty traders.

Dori also noted that the futures contract, which had been denominated in bitcoin, had fallen in the course of the increase and that the financial rates had remained moderate. This is often not in line with the high-leveraging multi-purpose feature, more like a passive flat-forward drive of prices.

  • Present bitcoin ETF net inflow for the week of the breakthrough was about $1.92 billion.
  • As of Wednesday last week, ETF had been net-inflow for eight consecutive trading days.
  • This 8 trading days cumulatively attracted about $2.8 billion.

According to analysts, the continued inflow of ETFs is important, as the initial reaction of the bond market to the Ministry of Finance news has weakened. If the long-term rate of return returns to pre-advertisement levels and bitcoin continues to remain high, it is all the more important that the encrypted market itself buys up.

September 9th.

The next point of concern for the market was the official launch of the Ministry of Finance's extended repurchase on September 9. In Dori ' s view, the market usually expects to deal with policy, rather than wait for operational response, so the real key is whether liquidity can continue to support risk assets after the expectation is digested.

He mentioned that a return to higher long-term rates of return would indicate that repurchases did not keep down the cost of financing and that market liquidity could also be withdrawn if the United States Treasury General Account was rebuilt. At the same time, the rapid increase in the rates of funds and the unwinded contracts suggests that leveraged funds may again dominate the movement of bitcoin.

Lee gave more direct observations, consisting mainly of three.

  • Is the current bitcoin ETF going weak?
  • Change in three-month futures base margin relative to United States debt return
  • Did bitcoin fall back into the pre-break zone?

Overall, the round has shifted from a simple macro-stimulation to a test of whether real demand can match. Next, ETF requisitions, derivative leverage changes and the United States dollar liquidity environment will be the main clue to whether Bitcoin will continue to rise.