Everyone knew bitcoin was stuck. For weeks, traders watched it shuffle around a narrow band, drawing a line at $67,000 that the price could not cross. So they did what traders do: they bet against it, wagering that the line would hold.
It did not. The Treasury changed everything in one afternoon.
The trouble started on Wednesday, when the Treasury Department surprised the market by announcing a major expansion of its bond-buyback program. The move was meant to calm a bond market that had been under selling pressure, but the immediate reaction took traders by surprise.
Bitcoin had stayed below $67,000 for weeks, but by Friday it was above $77,000. That move destroyed short sellers who had bet against it, forcing them to buy back bitcoin at huge losses.
Almost everything changed at once. Gold and bitcoin jumped together, and the dollar sold off. Investors were suddenly looking for alternative assets.
For weeks, bitcoin had stayed pinned near $67,000. It had dropped from a high of around $95,000 in January and had slipped below $60,000 in June. Then, in one afternoon, the Treasury blew up that trade.
When the buyback news hit, bitcoin climbed above $77,000 and caught every paved blast.
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By Friday, bitcoin had gone above $77,000. That hurt short traders badly.
Washington's actions provided additional fuel. The administration urged lawmakers to accelerate digital asset regulations, while a White House meeting offered clearer guidance for crypto firms. These developments compounded the market's upward momentum.
This week mattered not just because bitcoin went up, but because the dollar's weakness and bitcoin's rise happened at the same time. When investors move out of traditional currencies and into assets like bitcoin, they are often sending a warning. This week, they did.
For now, the Treasury's move worked. It calmed bond markets, but the debt is still growing and inflation is still an issue. Investors who trusted the dollar stopped for a moment and looked at gold and bitcoin instead.