Bitcoin finally escaped the trading purgatory it had been stuck in since early July, surging from around $64,100 to above $68,000 in a matter of hours after the US Treasury announced a major expansion of its bond buyback program. The move liquidated roughly $1.4 billion in short positions within 24 hours, making it the largest short-side wipeout since 2021.
The catalyst wasn’t a crypto-native event. It was the Treasury Department announcing on August 19 that it would double the cap on its liquidity-support buyback operations for longer-dated securities, raising the limit from $2 billion to at least $4 billion per operation. The expanded program runs from September 9 through November 4, 2026.
How a bond buyback broke Bitcoin’s range
For roughly six weeks, Bitcoin had been grinding sideways between $60,000 and $67,000. The Treasury’s announcement changed the calculus almost instantly.
When the government buys back its own longer-dated bonds, it pushes their prices up and their yields down. The 30-year Treasury yield, which had recently touched a 19-year high near 5.34%, dropped to approximately 5.19% following the news.
