Bitcoin Tops $80,000 After 22% Three-Day Surge, With More Upside Seen: Park Shin-young’s Pre-Market Brief

1. Gold Gains on Treasury Buyback Expansion Bets

Bullish wagers on gold are building as investors bet the U.S. Treasury’s plan to expand long-term bond buybacks could push down Treasury yields and weaken the dollar. Deutsche Bank said the policy shift could send gold above $4,800 an ounce.

Open interest in call options on SPDR Gold Shares (GLD), a spot gold exchange-traded fund, exceeded put options by about 2.5 million contracts last week, the widest gap since February. Calls are used to bet on rising prices, while puts are used to position for declines. A large call-over-put gap in open interest suggests investors are preparing more aggressively for further gains in gold.

Gold has climbed 15% over the past three weeks. It rose more than 5% last week, extending its winning streak to five weeks. Even so, it remains about 17% below its record high.

The Treasury said it would increase the maximum size of each long-term bond buyback operation to at least $4 billion from $2 billion. Some investors also see roughly $1 trillion in the Treasury General Account, or TGA, as a potential funding source for the buybacks.

“The Treasury’s policy shift further supports a positive outlook for gold,” Deutsche Bank analyst Michael Hsu said. The move could cap long-term yields and encourage dollar weakness.

The dollar index has fallen about 0.8% this month. Because gold is priced in dollars, a weaker greenback lowers the cost of buying the metal for investors using other currencies. Lower interest rates also reduce the appeal of interest-bearing Treasuries and can raise gold’s relative attractiveness.

Bridgewater Associates founder Ray Dalio said investors could hold as much as 10% to 15% of their portfolios in gold to guard against a debt crisis driven by rising government borrowing.

Investors are also watching this week’s Jackson Hole symposium for comments from Federal Reserve Chair Kevin Warsh. Citi said a hawkish message from Warsh could lift the dollar and Treasury yields, slowing gold’s advance. A dovish signal, by contrast, could offer fresh fuel for further gains.

2. Bitcoin Surges 22% in Three Days, Breaks Above $80,000 as Spot ETFs Pull In $1.92 Billion

Bitcoin surged about 22% last week, marking its biggest three-day gain since 2023, and broke above $80,000. Expectations for further gains are building as institutional money flows into spot ETFs, a large short squeeze unfolds and selling pressure eases.

Bitcoin moved above its 200-day moving average of about $69,050 last week. It extended the rally to as high as $80,501, up more than 2% at one point. The 200-day moving average tracks the average price over the past 200 days. Trading above that level is often taken as a sign an asset may be emerging from a long-term downtrend.

The rally also triggered forced liquidations for traders betting on a decline. More than $4 billion of short positions across the digital-asset market were liquidated. A short squeeze occurs when bearish traders buy back positions to limit losses, accelerating the advance.

Spot Bitcoin ETFs recorded net inflows of $1.92 billion last week, the biggest haul since October 2025. The inflows suggest the rebound was driven not only by forced liquidations but also by discretionary buying from institutional investors and others.

Risk appetite also got a boost after the Treasury announced an expansion of long-term bond buybacks, briefly pushing long-term yields lower. Concern over U.S. fiscal conditions and inflation has also increased demand for Bitcoin as a scarce asset, with supply capped at 21 million tokens.

Needham said Bitcoin miners and crypto-holding companies sold a combined $4.2 billion of Bitcoin in the first half, easing much of the selling pressure. With investor sentiment gauges falling to their lowest since 2022, the firm said fresh buying could lift prices more easily.

22V Research said Bitcoin typically posts weekly moves of about 3%, making last week’s 22% rally statistically unusual. Fundstrat said the advance may not be just a short-term rebound, citing spot ETF inflows, rising trading volumes and increased stablecoin issuance.

Ether traded up 1.17% at $2,498, while XRP rose 2.6% to $1.52. XRP has surged about 50% over the past seven days.

3. Broadcom CDS Jumps to 120 Basis Points From 40

Broadcom’s credit-default swap premium has climbed from about 40 basis points to 120 basis points over the past few months, fueling concern in the bond market over the financing structures underpinning sales of AI chips.

A CDS is a derivative that lets investors trade the risk that a company may fail to repay its debt. If a Broadcom bondholder wants protection against default, that investor pays a regular fee to the seller of the swap. A higher CDS spread means the cost of that protection has increased and the market is assigning greater credit risk to the company.

At 120 basis points, for example, it would cost about $120,000 a year to insure $10 million of Broadcom corporate bonds. A move from 40 to 120 basis points means the cost of hedging that risk has tripled.

Broadcom’s CDS is not the highest among technology companies. Oracle is at about 220 basis points and SpaceX at about 165 basis points, both above Broadcom. The key issue is less Broadcom’s absolute risk level than the speed at which its perceived credit risk has risen relative to other major tech companies.

The market is focused on a structure in which Broadcom does more than sell AI semiconductors and also helps support customer financing. Broadcom is involved in a $35 billion financing arrangement backed by firms including Apollo Global Management and Blackstone. Market talk has also pointed to the possibility of raising more than $60 billion in additional debt to fund further chip purchases.

Under that structure, investment firms provide funding to a special purpose vehicle, or SPV, which then buys Broadcom’s custom AI chips and server equipment. Anthropic does not buy the equipment directly. Instead, it rents computing resources held by the SPV and pays lease fees. Broadcom recognizes revenue when the chips are sold.

The risk emerges if AI companies fail to monetize their businesses as hoped. If Anthropic cuts back on computing investment, the SPV’s lease income and debt-servicing capacity could weaken. If Broadcom has provided guarantees or a backstop, it could face financing obligations just as revenue starts to slow.

Broadcom’s custom ASICs are tailored to specific customer systems, making them relatively harder to resell to other buyers. If customer demand weakens, the residual value of the equipment could fall.

The sharp rise in CDS does not mean Broadcom faces an immediate default risk. It does suggest the bond market is starting to price not only the growth potential of AI semiconductor sales but also the guarantees and financing risks Broadcom may be taking on to generate that revenue.

4. China Chip Self-Sufficiency Reaches 70% by Output, Though EUV Gap Limits 7-Nanometer Push

China is rapidly raising semiconductor self-sufficiency by production volume through heavy capital investment. Even so, the lack of advanced lithography tools remains a constraint on costs and yields for processes below 7 nanometers, while dependence on overseas suppliers for high-performance chips persists.

Goldman Sachs said China’s semiconductor self-sufficiency ratio by output rose to 70% in June 2026 from 38% in January 2010. That measure is based on production volume. A value-based self-sufficiency ratio, which would reflect pricing and technology levels, may be lower.

China is broadening its domestic supply chain beyond etching and deposition equipment to include ion implantation, inspection and metrology tools. The strategy is aimed at securing the full range of chipmaking equipment, from lithography for circuit patterning and etching to remove unwanted material, to deposition for thin films and inspection and metrology for defect detection.

China’s biggest constraint remains extreme ultraviolet lithography equipment. EUV is the key tool for efficiently producing circuits at 7 nanometers and below. China cannot import the machines from ASML, the Dutch company that is effectively the only commercial supplier, because of U.S. export restrictions.

China is trying to produce 7-nanometer-class chips with existing deep ultraviolet, or DUV, equipment by using multi-patterning, which divides circuit formation into several steps. But adding more process steps increases production time and cost, and can also raise circuit error rates and defect rates. Being able to make a 7-nanometer chip is different from mass-producing it reliably and at low cost.

Goldman Sachs projects China’s shortfall in advanced logic chips at 7 nanometers and below will still be about 34% in 2035. It also expects the performance of Chinese AI accelerators to rise from 320 teraflops on an FP16 basis in 2023 to 4 petaflops on an FP8 basis by the fourth quarter of 2028.

China’s semiconductor equipment investment in 2030 is estimated at $82 billion, 79% above previous forecasts. The spending is being driven by efforts to achieve chip self-reliance, demand tied to generative AI, the response to export controls and a policy push to prioritize Chinese-made products.

ChangXin Memory Technologies, or CXMT, China’s largest DRAM maker, is projected to supply about 50% of domestic DRAM demand by 2028. Its monthly wafer capacity is expected to reach 665,000 in 2030, more than double the level projected for 2026.

Goldman Sachs said CXMT’s commodity DRAM supply could reach about 41% of Samsung Electronics Co.’s level and about 50% of SK Hynix Inc.’s by 2028. The company’s production expansion could put downward pressure on prices for commodity DRAM used in smartphones, PCs and general-purpose servers.

5. Druckenmiller Says Treasury Should Let Bond Market Speak, Criticizes Buybacks

Stanley Druckenmiller, chairman of Duquesne Family Office, criticized the U.S. Treasury’s expanded bond buyback policy and said the market should be allowed to determine long-term Treasury yields.

In a recent Wall Street Journal opinion piece, Druckenmiller wrote that the Treasury market had been functioning normally and conditions did not warrant government intervention in pricing. Treasury auctions had not failed, primary dealers had not stopped trading because of liquidity shortages, and investors had not faced forced liquidations.

He pointed to a U.S. fiscal deficit equal to about 6% of gross domestic product even as the economy remains close to full employment and inflation stays above target. In that environment, the government’s ability to borrow at rates roughly in line with economic growth suggests financial conditions are accommodative rather than restrictive.

Druckenmiller said even an artificial reduction of 1 basis point, or 0.01 percentage point, in long-term Treasury yields would help politicians delay fixing fiscal problems. Artificially low rates make the government’s projected interest costs look lower than they really are and dilute the urgency of the national debt problem.

He cited the period from 1942 to 1951, when the Fed capped long-term Treasury yields to help finance World War II. The cap remained in place even after the war ended, and expanded fiscal deficits and monetary growth later fed double-digit inflation.

Druckenmiller argued that once the market starts to believe the Treasury is defending a particular yield or bond price, every subsequent rise in rates becomes a test of the government’s resolve. To prevent that, the Treasury would have to keep increasing the size of its bond purchases and would ultimately lose against market fundamentals.

He also took issue with the timing of the expanded buyback schedule, saying it overlaps with the U.S. midterm election campaign season. Even the impression that debt-management policy is being shaped by the political calendar could damage trust in the Treasury market built over more than 200 years.

“Governments that try to defend prices against economic fundamentals always lose,” Druckenmiller wrote. “Let the Treasury market speak.”

Park Shin-young, New York correspondent nyusos@hankyung.com