Bitcoin Tops $80K as Crypto Rally Returns
Bitcoin surged past $80,000 for the first time since May as investors returned to cryptocurrencies amid renewed interest in the so-called “debasement trade.”
What Is the Debasement Trade?
The latest rally gained momentum after U.S. Treasury Secretary Scott Bessent announced plans to double the Treasury Department’s buyback of long-term bonds in an effort to ease pressure from rising yields. The decision followed a sharp increase in the 30-year Treasury yield, which reached its highest level since 2007 amid concerns over the conflict with Iran and the growing U.S. national debt, now approaching $40 trillion.
The announcement triggered renewed selling of the U.S. dollar while supporting demand for alternative assets such as bitcoin and gold. Adding to the sentiment, billionaire investor Ray Dalio warned of a potential debt crisis in a blog post on Friday, advising investors to reduce exposure to debt-based assets like bonds and increase allocations to gold and, to a lesser extent, bitcoin.
The debasement trade refers to an investment strategy in which capital is shifted away from fiat currencies and government debt toward assets with limited supply, including gold and bitcoin. Investors typically view this approach as a hedge against currency depreciation and a weakening U.S. dollar.
The cryptocurrency market also received a boost last week after President Donald Trump hosted leading crypto industry executives at the White House. During the meeting, Trump urged Congress to advance the long-delayed CLARITY Act, legislation strongly supported by the crypto sector that aims to establish a clearer regulatory framework for digital assets.
“We need Congress to take the next step by passing the CLARITY Act—a fair version of the CLARITY Act,” Trump said. “It is a powerful piece of legislation that will help ensure the United States stays ahead of China and remains a global leader in this space.”
The combination of supportive policy signals, concerns over U.S. debt levels, and growing interest in alternative stores of value has helped drive bitcoin’s latest advance, pushing the cryptocurrency above the $80,000 mark for the first time in months.