Bitcoin briefly surged past $80,000 in early trading Tuesday, extending gains from a cryptocurrency rally last week amid renewed investor appetite for riskier assets.
The top cryptocurrency was last seen trading 0.5% higher at $79,361.32 around 12 p.m. ET Tuesday.
Crypto-related stocks like Robinhood, Coinbase and Strategy rose 6.9%, 4% and 3.4%, respectively.
“This momentum has caught the attention of investors who had previously been looking elsewhere, and we are now seeing retail participants and smaller wallets begin to take positions,” Paul Howard, senior director at Wincent, said in a note Tuesday.
“This comes ahead of what some analysts, myself included, expect could be a continued ascent for Bitcoin, potentially taking BTC towards $100,000 by year-end.”
Last week, Bitcoin roared more than 20% higher over three days for its largest three-day gain since 2023, partly fueled by a short squeeze as more than $4 billion worth of bearish crypto positions were liquidated.
It was triggered by the Treasury Department’s pledge to “at least double” its debt buybacks, which briefly sent Treasury yields lower and revived demand for risky assets. Treasury Secretary Scott Bessent later said accelerated buybacks could surpass the planned $4 billion mark.
Mounting concerns over inflation and rising government debt also revived institutional investor interest in alternative assets. US spot bitcoin exchange-traded funds drew in $1.92 billion in net inflows last week – their largest weekly haul since October.
But it’s unclear whether the rally will last and put an end to a long crypto winter. Bitcoin saw a similar boost in January 2023, for example, that ended up being short-lived.
Nic Puckrin, founder of Coin Bureau, said Bitcoin is vulnerable to a sudden reversal after $4 billion in short positions were liquidated, since there’s less fuel to propel the rally further.
“Everything hinges on Fed Chair Kevin Warsh’s keynote at Jackson Hole on Friday,” Puckrin told The Post.
“If it’s dovish, the euphoria could gain a fresh catalyst. But if he’s hawkish, this could stop the rally in its tracks. The PCE reading on Wednesday, as well as the GDP numbers, will provide an early clue of where sentiment might be going.”
Though inflation concerns have helped spur the current rally, investor sentiment could flip-flop on Friday if Warsh comes off more hawkish than expected, since that would imply interest rate hikes – which tighten liquidity and are bad for crypto, he explained.
Activity in the options market, however, suggests investors are betting the crypto rally will last, since they are now wagering on Bitcoin gains further into the future – not just short-term positions.
It’s also a good sign for crypto buffs that Bitcoin has been soaring without recent purchases from Strategy, the world’s largest corporate holder of the cryptocurrency. It hasn’t bought Bitcoin for two weeks – so if it starts buying again, it could push the crypto even higher.
Crypto advocates are hoping Congress will soon pass the Clarity Act, a cryptocurrency regulation bill, after President Trump last week urged lawmakers to approve “a fair version” of the law before the end of the year.
The House approved the legislation last summer but it has been stalled in the Senate, where Democrats are pushing for more stringent restrictions that will prevent Trump and other public officials from profiting off cryptocurrency. GOPers have argued that proposed changes to the bill are too restrictive.
A procedural vote on the bill is scheduled for Sept. 15. If the Senate again fails to approve the legislation, it could effectively kill the act’s chances of advancing this year – a key concern for Republicans ahead of the midterm elections.
Bitcoin is still off from its 2026 high of $94,820 in mid-January and all-time high of $126,198 last October, as crypto enthusiasts hoped the Trump administration would usher in crypto-friendly policies.