Bitcoin nears US$80,000 amid biggest weekly rally in three years

NEW YORK: Bitcoin is on pace for its best weekly gain in more than three years as traders assess the fallout from a recent spike in bond yields and a new initiative from the United States aimed at fiscal consolidation.

The original cryptocurrency jumped as much as 9.4% and changed hands at around US$77,500 in late New York trading. It has advanced roughly 23% last week, a gain that, if sustained, would be the biggest on that basis since March 2023. Bitcoin last traded at US$80,000 in May. 

Market exuberance returned to cryptocurrencies when US Treasury secretary Scott Bessent announced last Wednesday the department would at least double the size of its long-dated bond buybacks, triggering an upswing that forced traders to liquidate billions in short positions.

The same day, President Donald Trump met with crypto industry leaders, further adding to optimism.

Meanwhile, gold reached its highest level since May amid investor fears that the intervention in the bond market will weigh on the dollar. In a LinkedIn post last Friday, Bridgewater Associates founder Ray Dalio said investors should diversify across assets and countries with strong finances.

Underweighting bonds and holding about 10% to 15% of a portfolio in gold and “a bit” of bitcoin could both reduce risk and boost returns, he said.