Bitcoin Reclaims $80,000 for First Time in More Than Three Months

Bitcoin rose back above $80,000 intraday for the first time in more than three months. A weaker dollar, unease in the U.S. Treasury market and fresh inflows into spot exchange-traded funds are reviving sentiment toward digital assets.

As of 3:10 p.m. on Aug. 25, Bitcoin traded at $78,945.31, according to CoinMarketCap. Earlier in the Asian session, Reuters reported that it climbed as high as $81,237.94, its highest level since mid-May.

Bitcoin had recently traded in a range around $64,000. The mood began to shift after Aug. 19, when buying picked up on news that the U.S. Treasury would expand repurchases of mid- to long-term government bonds and optimism grew over improvements to crypto rules.

Reuters cited dollar weakness and the return of currency-debasement trades as key drivers of the rally. As the Treasury expanded bond buybacks to help stabilize long-term yields, investors sold dollars and bought alternative assets such as gold and Bitcoin, the report said.

Investor sentiment also improved quickly. The Crypto Fear & Greed Index stood at 83 on Aug. 25. On the 0-to-100 scale, a reading above 80 is classified as extreme greed, the strongest level of investor appetite.

Institutional money is also returning. Data from SoSoValue show spot Bitcoin ETFs recorded net inflows of $1.91779 billion over the past five trading days.

Expectations for regulatory improvement also supported prices. Discussions in the U.S. on reducing uncertainty around digital-asset regulation have fueled hopes for broader institutional participation.

Still, whether the rally continues may hinge on U.S. economic data and monetary-policy events later this week. The U.S. July personal consumption expenditures price index is due on Aug. 26. The Federal Reserve's Jackson Hole policy symposium runs from Aug. 27 through Aug. 29. If inflation data or comments from Fed officials move the dollar and Treasury yields again, Bitcoin may also feel the impact.

Shim Soo-bin, an analyst at Kiwoom Securities, said Bitcoin's rise was driven by easing uncertainty over U.S. crypto regulation and the Treasury's expanded buybacks of mid- to long-term bonds. With major events scheduled this week, the token's direction could change later in the week, she added.

Lee Song-ryeol, Hankyung.com reporter yisr0203@hankyung.com