Bitcoin Drops Below $80,000 as U.S. Yields Slide

Bitcoin slipped under $80,000 on Aug. 25 after briefly climbing to $81,237, its highest level since mid-May. The move mirrored gold's pullback from a three-month high near $4,677 an ounce, as falling U.S. bond yields complicated the outlook for investors crowding into scarce-asset trades. Even after the intraday setback, Bitcoin remains up about 28% for the month. That puts August 2026 on track to be its strongest monthly performance since November 2024. The Treasury buyback trigger The latest decline in yields traces to Aug. 19, when the U.S. Treasury said it would at least double its liquidity-support buybacks of long-dated bonds. The size per operation rises from $2 billion to a minimum of $4 billion, effective Sept. 9. Following the announcement, the 10-year Treasury yield settled around 4.71% to 4.72%, a modest but notable drop that weighed on the dollar and initially boosted both Bitcoin and gold. The broader fiscal picture gives the plan added significance. With U.S. national debt now above $40 trillion, expanding buybacks functions as both a liquidity tool and a confidence signal that Washington is prepared to step in if long-end rates become disorderly. ETF demand and the institutional bid Spot Bitcoin ETFs have taken in nearly $2 billion over recent sessions, a stretch that also featured a wave of short liquidations in crypto derivatives. Those forced exits can amplify rallies: traders closing short positions must buy Bitcoin, which lifts prices and can trigger additional short covering. Bitcoin has also been trading more like a hard asset than a stand-in for tech risk, with its correlation to gold increasing. President Trump's recent push for clearer regulatory definitions around digital assets has further supported sentiment, feeding through into stronger inflows. Distance from the record Bitcoin's all-time high is about $126,000, set in October 2025. Around $80,300, it sits roughly 36% below that peak. Market focus now shifts to Sept. 9, when the Treasury's expanded buyback program begins. If the operations help cap long-term yields and keep the dollar on the back foot, the conditions behind August's surge could remain in place. The dollar index bears watching as it has been drifting lower alongside yields. With the Treasury easing financial conditions through buybacks while the Federal Reserve maintains a cautious stance, markets are likely to press for a clearer resolution to that policy tension.