[Bitcoin Now] US Fiscal Burden Sparks Rebound... Can the Bitcoin Rally Continue?

Buying Momentum amid Dollar Dilution Concerns

Short Squeezes and Policy Momentum

The Challenge of Securing Long-Term Buyers

Recently, Bitcoin has continued its rally amid concerns about the dilution of the dollar’s value due to the rising burden of US government debt. The widening price increase appears to be driven by a combination of debasement trades in response to declining currency value, large-scale forced liquidations (short squeezes), and expectations for regulatory easing. However, unlike gold, which has a solid base of buyers such as central banks, Bitcoin is said to have a weaker price support structure, making it essential to secure stable long-term demand sources.

According to the financial investment industry on September 1, the price of Bitcoin started the year at $88,812.1 and climbed to its annual high of $97,838.4 on January 14, before entering a downward curve. On July 1, it fell to $57,832.5 and continued to fluctuate in the $60,000 range for an extended period. However, as the dollar shifted into a weakening trend last month, capital flowed in and, as of 1:30 p.m. on August 31, Bitcoin was trading at $77,517.0.

US government debt surpassed $40 trillion this year, continuing its steep uptrend. According to iM Securities, the combination of rising interest rates and growing debt has already pushed the US government’s annual interest payments above $1 trillion. As the vicious cycle of ‘fiscal deficit expansion → increased government bond issuance → rising interest costs → further fiscal burdens’ becomes entrenched, the US Treasury has doubled the buyback size per transaction for 10–30-year long-term Treasuries from the previous $2 billion to at least $4 billion. This measure aims to directly stabilize the supply and demand for long-term bonds to prevent a rise in long-term interest rates driven by government bond supply pressures. Immediately after the announcement, yields on the 30-year US Treasury fell by around 9 basis points in a single day. However, the prevailing view in the market is that expanding buybacks alone is unlikely to prevent a rise in long-term rates stemming from fiscal risks.