Bitcoin (BTC) Sells Off to $79K as Gold and Bond Yields Cool

Bitcoin (BTC) Pulls Back After $81,265 Peak

After printing a 14-week high of $81,265, Bitcoin (BTC) slipped below $80,000 during the U.S. session, with TradingView data showing a low near $78,111 on Bitstamp. The retreat unfolded as 30-year Treasury yields cooled below 5.2% and gold gave back nearly 2% from a multi-month peak around $4,697 per ounce. U.S. equities, in contrast, edged higher, with the S&P 500 and Nasdaq each posting modest gains. Traders now look to Wednesday’s PCE inflation report and Nvidia earnings as the next volatility catalysts, while CME FedWatch data still assigns roughly 61.9% odds to the Federal Reserve holding rates steady in September.

Treasury Doubles Buybacks to $4B Per Operation

The pullback followed an overnight push to roughly $81,160, Bitcoin’s first move above $81,000 since January. Strategists argue the episode could mark the return of the debasement trade, the practice of buying hard assets such as Bitcoin and gold as a hedge against currency depreciation. Last week’s Treasury decision to at least double its liquidity-support bond buybacks weighed on the dollar and favored non-yielding assets. Spot Bitcoin ETFs absorbed nearly $2 billion in inflows, their best week since October. Bitcoin’s bear market has also been its shallowest on record, analysts note, with the coin still well below October’s record high near $126,080.

The rally began in earnest on Aug. 19, when the U.S. Treasury raised the size of each long-dated nominal bond buyback from $2 billion to at least $4 billion per operation. Yields initially eased but later climbed again, while Bitcoin continued advancing by more than $10,000 — a sign investors may be reading the program as evidence of fiscal strain rather than a simple liquidity tool. Gold moved in near-lockstep, trading above $4,600 per ounce as both assets rallied. Investor Ray Dalio has publicly urged holding gold and some Bitcoin amid concerns over U.S. debt levels. Spot ETF inflows totaled roughly $1.92 billion over five days, and short liquidations above $4 billion in less than two days accelerated the squeeze.

In Asian trading on Aug. 25, Bitcoin changed hands near ¥12.85 million, while ether traded around ¥399,000 and solana near ¥16,100, with the global crypto market capitalization at roughly ¥444 trillion. Bitcoin dominance stood near 60.2%, regional market data showed. The recovery above $80,000, however, still leaves BTC about 36% below its all-time high near $126,000, leading traders to describe the move as a rebound rather than a new record. Other major altcoins outperformed, with ether up about 30% over seven days and reclaiming $2,500 for the first time in seven months.

Buyback Debate Heats Up as Debt Tops $40T

Treasury Secretary Scott Bessent said the per-operation buyback size could exceed $4 billion, with the expanded schedule running from Sept. 9 to Nov. 4. The program is distinct from quantitative easing: the Treasury repurchases already-issued securities to ease liquidity in specific maturity ranges rather than injecting new bank reserves. Stanley Druckenmiller warned that capping long-end yields amounts to “price management” and that a 30-year yield near 5.5% is a fiscal signal rather than a crisis. U.S. total debt surpassed $40 trillion for the first time on Aug. 19. Market data showed Bitcoin trading near $80,323 in Asia on Aug. 25 after hitting an intraday high of $81,237.94.

Treasury officials have also discussed using part of the Treasury General Account, the government’s operating cash balance, to fund larger bond buybacks, according to a report. The Treasury’s daily cash balance statement showed the TGA at about $933.2 billion on Aug. 21, funds that could support the market without new short-dated bill issuance. Derivatives activity picked up sharply as the idea circulated: futures volume jumped 57.8% to $97.43 billion, and options volume surged 156.4% to $7.34 billion. Despite $164.1 million in 24-hour liquidations — nearly two-thirds from short positions — the long/short ratio held near 1.00, pointing to spot-led buying rather than fresh leverage.

Bitcoin’s Next Leg Hinges on $80.4K Resistance

COINOTAG’s proprietary 42-indicator composite S/R scoring engine rates the $78,573 support at 78/100, reinforced by HVN, Fibonacci 0.114, LVN and Pivot Point levels, while the $80,438 resistance scores 75/100 on a confluence of Fibonacci 0.000, Donchian Upper, R1 and Bollinger Band Upper. With spot at $79,302 and RSI at 82.50, the market is overbought but still in an uptrend. Derivatives remain balanced: funding is 0.0024%, open interest stands at $15.31 billion and the long/short ratio is 1.01. The Fear & Greed Index at 74 favors continuation, but a daily close below $78,573 would invalidate the bullish setup and open $72,815, which scores 64/100; above $80,438, momentum could extend toward $87,657.