Bitcoin (BTC) touched $80,000 on Monday, then handed the level straight back. Critics are lining up against the US Treasury plan that sparked the move.
The token traded near $78,835 at press time. The bond market had already run this exact play last week, and it did not hold.
What Pushed Bitcoin to $80,000
The Treasury General Account (TGA) is the government’s checking account at the Federal Reserve. Tax receipts fill it. Treasury Secretary Scott Bessent has let it swell, with reports pegging the account near $950 billion.
Treasury’s own daily cash statement showed $935.1 billion on August 20, the latest official reading. Two senior Treasury officials told CNBC that money could fund bond buybacks.
Treasury doubled those buybacks on August 19. Long-end operations rose from $2 billion to at least $4 billion each. The first lands on September 9, per the department’s own announcement.
Traders liked the plumbing. Spending TGA cash does not grow the Fed’s balance sheet. It just moves money into bank reserves. That reads as liquidity, and liquidity has been Bitcoin’s fuel all month.
The Bond Market Already Round-Tripped This Trade
Treasury’s own yield data tells the story. The 30-year yield hit 5.31% on August 17, its highest reading since 2007.
The buyback news knocked it down to 5.19% two days later. By August 21 it sat at 5.27%. The entire rally vanished in two sessions.
Monday delivered a second bounce. The 30-year eased to 5.21% and the 10-year to 4.69%. Bitcoin’s spot price rode that wave to $80,000, then slid.
Why Critics Say It Will Not Hold
Bessent calls the strategy a “Treasury Twist.” The name echoes Operation Twist, the 1961 attempt to bend long-term rates lower.
Citadel Securities calls it financial repression. The firm warns it could weaken the dollar and stoke inflation. The deficits behind the yield spike go untouched.
Peter Schiff, chief economist at Euro Pacific Asset Management, has long warned about bond markets.
“This reckless plan will substantially shorten the average maturity of the national debt, increasing our exposure to rising short-term rates… It’s a recipe for massive QE and runaway inflation. Got gold?” Schiff wrote.
Benjamin Chabot, a former economist at the Federal Reserve Bank of Chicago, asked the sharper question.
“Does it matter if Treasury uses the TGA to buy bonds? Probably not. TGA funds are mostly spoken for. What matters is how Treasury refills the TGA after purchases,” he stated.
Fundstrat’s Tom Lee took the other side. He says the shift favors long-duration assets, crypto included.
Treasury has not spent a dollar of the account. September 9 is when the talk becomes numbers.