Bitcoin Falls Back After $80,000 Rally Amid Criticism of Treasury's $950 Billion Buyback Plan

What Pushed Bitcoin to $80,000

The Treasury General Account (TGA), the federal government's checking account at the Federal Reserve, has grown to approximately $950 billion according to recent figures. Treasury Secretary Scott Bessent has allowed the account to expand significantly. On August 19, the Treasury doubled its bond buyback program, raising long-end operations from $2 billion to at least $4 billion. The first scheduled purchase under this plan is set for September 9.

Critics Swarm the Treasury Buyback Plan

Analysts and industry observers have turned sharply critical of the Treasury's approach. Citadel Securities has labeled the expanded buybacks 'financial repression,' warning that such measures could weaken the dollar and fuel inflation. Peter Schiff, chief economist at Euro Pacific Asset Management, described the plan as 'reckless' and argued it would shorten the average maturity of the national debt, potentially leading to substantial quantitative easing and runaway inflation. Benjamin Chabot, a former Federal Reserve Bank of Chicago economist, questioned whether the timing of Treasury's repatriation of TGA funds matters, suggesting instead that the focus should be on how the Treasury refills the account after purchases.

Market Reaction and Yield Data

The rally proved short-lived. Bitcoin tested $80,000 while U.S. 10-year and 30-year Treasury yields slipped. The 30-year yield peaked at 5.31% on August 17—the highest since 2007—before falling to 5.19% two days later and settling at 5.27% by August 21. The entire upward movement evaporated across two trading sessions.