US Treasury Increases Cash Balance: Will Bitcoin Rally be Affected?

• The US Treasury Department has increased its cash balance to $500 billion within a month after the Biden-McCarthy debt ceiling agreement.
• The replenishment of the General Account of the Treasury (TGA) does not affect risky assets as it does not affect the net liquidity of the US dollar.
• The price of BTC increased by 15% in June. The price is currently trading at $30,480 and has experienced a 1% decrease in the last 24 hours.

The US Treasury has increased its cash balance to $500 billion following the debt ceiling agreement between Joe Biden and Kevin McCarthy. Meanwhile, the price of Bitcoin has been rapidly rising.

US Treasury Increases Balance to $500 Billion

The US Treasury Department has increased its cash balance to $500 billion within a month after the Biden-McCarthy debt ceiling agreement. The crypto and stock markets continue to rise as the replenishment of the Treasury account has not yet affected the liquidity of the US dollar.

The global crypto market value, supported by strong trading volume, has reached $1.2 trillion. The prices of Bitcoin (BTC) and Ethereum (ETH) have reached annual highs due to financial giants like BlackRock and Fidelity leading the crypto trend.

The replenishment of the General Account of the Treasury (TGA) does not affect risky assets as it does not affect the net liquidity of the US dollar. During the debt ceiling agreement, the TGA balance was below $40 billion, but now it is over $465 billion. The US Treasury is increasing its account balance without affecting financial markets and the liquidity of the US dollar.

In July, the US Treasury Department will conduct billions of dollars worth of bond and note auctions according to its auction program. The US Treasury plans to add another $1 trillion in the next six months.

As long as there is sufficient liquidity in the US dollar, the crypto and stock markets will continue to rise. The price of Bitcoin (BTC) reached $31,400 this week. Meanwhile, the stock markets ended Friday positively, with the Dow Jones rising by 0.84%, the S&P 500 by 1.23%, and the Nasdaq by 1.60%. Additionally, the US Consumer Price Index (PCE) inflation dropping to 4.6% indicates the possibility of further upward movement.

Crypto analysts and Bloomberg analysts are optimistic that the price of Bitcoin will rise to $40,000 in early July or August due to the increase in spot Bitcoin ETF applications and institutional inflows.

Bitcoin Price Reacts Excessively to SEC Report

The price of BTC increased by 15% in June. The price is currently trading at $30,480 and has experienced a 1% decrease in the last 24 hours. The 24-hour lowest and highest values for Bitcoin are $29,600 and $31,093, respectively. Meanwhile, the price of ETH is trading at $1,920, with a 1.5% increase.

Popular analyst Michael van de Poppe stated that the market overreacted to the US Securities and Exchange Commission’s (SEC) recent Bitcoin ETF applications, and he predicts further price increases for BTC, reaching $35,000-$40,000.