Bitcoin crossed $80,000 on Monday for the first time since 15 May, touched $81,220 in the following session and is trading in the region of $80,700. Including the current session, the advance over the past week reaches approximately 25%, the strongest move since March 2023. The asset now sits roughly 38% above the lows recorded between late June and early July, when the price briefly fell below $58,000.
Bitcoin Price, Source: Investing.com, Teroxx Research
The recovery was accompanied by a clear return of institutional demand. United States listed spot Bitcoin exchange traded funds attracted approximately $1.9 billion last week, the largest weekly inflow since October 2025, while spot Ethereum products recorded inflows of approximately $630 million. Together they accounted for more than $2.5 billion in net subscriptions, reversing the redemption pattern that characterised much of the first half of the year.
The primary driver was macroeconomic. The United States Treasury expanded its buyback programme for long dated government debt, from $2 billion to at least $4 billion, funded through increased short term issuance, and later signalled it could draw on its General Account to finance those operations. The market read the intervention as a currency dilution risk rather than curve stabilisation, against a federal debt burden above $40 trillion and a 30 year yield at 5.337%, its highest in approximately 19 years. The result was a weaker dollar, higher gold prices and the repricing of digital assets as protection against the debasement trade.
Positioning amplified the advance. Coinglass data indicate more than $457 million in short Bitcoin positions liquidated over 24 hours, alongside $112.3 million in Ether, following the elimination of billions in short exposure the previous week. The Fear and Greed Index advanced to 83, a level classified as extreme greed, which suggests stretched sentiment over the short term.
On the policy front, President Donald Trump publicly supported passage of a balanced version of the Clarity Act, the market structure bill that has remained stalled in Congress for more than a year over the classification of assets as securities or commodities, the treatment of yield paid on stablecoins, and proposed trading restrictions for legislators and public officials. In parallel, Stand With Crypto announced bipartisan support for 32 members of the House of Representatives ahead of the midterm elections, while the Fairshake super PAC reported $122 million available for the electoral period. Moving in the opposite direction, the Treasury included digital assets within the scope of secondary sanctions against Iran.
Trading volumes did not match the magnitude of the price move. Centralised exchange volume doubled over five sessions to approximately $37 billion, still well below the 12 month high of $105 billion. On a monthly basis, August has accumulated approximately $490 billion, against $670 billion in July. The reading requires structural context: spot volume now shares demand with exchange traded funds and with decentralised venues such as Hyperliquid and Lighter.
BTC and ETH Total Exchange Volume; Source: The Block, Teroxx Research
The remainder of the market followed with elevated beta. Ether advanced more than 30% over the period, XRP rose 53% and Solana gained 34%, while aggregate market capitalisation excluding Bitcoin and Ethereum increased by approximately 13%. Strategy sold approximately $2 billion in shares between 17 and 23 August without altering its holding of 840,447 BTC. The prevailing interpretation is that the move represents a catch up trade relative to other risk assets rather than the beginning of a new cycle, with attention now directed to the PCE price index this week.
The macroeconomic calendar should determine whether the advance consolidates. The release of the PCE price index, the Federal Reserve's preferred inflation measure, is the central event: a softer reading would reinforce expectations of easier policy and looser financial conditions, while a firmer print would support Treasury yields and the dollar and remove the principal argument behind the current move.
Beyond the inflation data, three variables warrant monitoring. The first is the long end of the yield curve, given that the 30 year rate remains close to multi decade highs and points to structurally tighter conditions. The second is the continuity of exchange traded fund inflows, which would confirm allocated rather than tactical demand. The third is the progress of the Clarity Act in Congress, still without a defined timeline.
What This Means for Investors
The advance originates in macroeconomic conditions rather than in fundamentals endogenous to the sector, with Bitcoin behaving as a hedge against monetary dilution in the same direction as gold. Its durability therefore depends on the trajectory of long term yields, the dollar and the inflation reading rather than on indicators internal to digital asset markets.
The quality of the flow is mixed. Exchange traded fund inflows represent allocated demand through regulated vehicles, but a material portion of the price move resulted from short liquidations, a mechanical and non recurring component, and subdued exchange volume indicates that broader participation remains contained. Sentiment in extreme greed territory, alongside sticky inflation and elevated long term yields, argues for phased exposure and predefined position sizing rather than tactical adjustments driven by recent price dynamics.
