Treasury Buybacks Could Push Bitcoin Toward $180,000, Strategist Says

Bitcoin has entered a stronger phase after recovering above the $70,000 mark, with investors increasingly focused on developments in U.S. bond markets and their potential effect on global liquidity. The latest catalyst is the U.S. Treasury’s decision to increase the size of its long-dated bond buybacks.

The Treasury said liquidity-support purchases for longer-dated nominal coupon securities will rise to at least $4 billion per operation from a previous $2 billion maximum, beginning September 9. Macro strategist Mark Connors believes a broader improvement in liquidity could bring Bitcoin closer to a much higher valuation, with $180,000 emerging as an important threshold in his outlook.

 

The Treasury’s latest decision represents a notable expansion of its efforts to support liquidity in the government bond market. The increased purchases will cover securities in the 10-to-20-year and 20-to-30-year maturity sectors. Rather than functioning like a conventional monetary stimulus program, these operations are designed primarily to improve trading conditions for Treasury securities and address liquidity concerns in the market.

The timing is significant because longer-term Treasury yields have remained elevated, increasing the government’s borrowing costs and putting pressure on financial markets. Treasury Secretary Scott Bessent has indicated that the department has additional tools available if necessary, while recent market movements have shown how quickly changes in government bond yields can affect other asset classes. Reuters reported that the buyback announcement helped push long-term yields lower while stocks, gold and Bitcoin advanced.

The initial increase may appear relatively modest compared with the enormous size of the Treasury market. However, investors are paying attention to the policy signal as much as the dollar value of the purchases. A willingness to expand operations could indicate that policymakers are prepared to respond more actively when liquidity deteriorates or long-term borrowing costs become uncomfortable.

 

 

Bitcoin’s relationship with Treasury yields is largely indirect, but it can become important when investors reassess the attractiveness of risk assets. Higher government bond yields can provide investors with more compelling returns from relatively lower-risk securities, potentially reducing demand for assets that carry greater volatility. Conversely, easing pressure in the Treasury market can improve the backdrop for speculative and growth-oriented investments.

The recent market response illustrates this connection. Bitcoin moved sharply higher after the Treasury announced the larger buybacks, while other risk assets also benefited. Reuters reported that Bitcoin rose above $70,000 as the policy announcement coincided with a decline in longer-term yields and a weaker dollar.

Still, Treasury purchases should not be confused with quantitative easing. The buyback program is intended to improve Treasury-market liquidity and manage outstanding securities rather than directly create new money for financial markets. Its eventual effect on yields will depend on the scale of future operations, investor demand, Treasury issuance and broader economic conditions.

For Bitcoin, the significance lies in the possibility that reduced pressure from long-term rates could make the overall liquidity environment less restrictive. If investors become more comfortable taking risk, cryptocurrencies could benefit alongside equities and other assets that tend to respond positively to improving financial conditions.

 

Mark Connors, chief investment officer at Risk Dimensions and a longtime bond-market investor, has offered one of the more bullish interpretations of the Treasury’s actions. He believes the latest intervention could represent an early indication that policymakers are becoming more concerned about elevated long-term borrowing costs and the difficulty of attracting sufficient demand for government debt.

Connors expects Treasury support could become considerably larger if authorities continue responding to pressure in the bond market. According to his analysis reported by CoinDesk, he sees the possibility of Treasury purchases eventually reaching roughly $10 billion to $30 billion per month. Such an expansion would be far more meaningful for market liquidity than the initial operations and could potentially change the macroeconomic environment facing Bitcoin.

The strategist had previously expected Bitcoin to remain relatively subdued until around November as the cryptocurrency followed its broader market cycle. The Treasury development has caused him to reconsider that timing. In his view, stronger liquidity could bring forward the next significant phase of Bitcoin’s advance rather than requiring investors to wait for the later part of the year.

Connors’ cycle forecast places Bitcoin between $180,000 and $360,000 through 2030. The lower end of that range is particularly relevant because he views $180,000 as the first major threshold Bitcoin could seek if Treasury support increases and pressure from long-term yields begins to fade. This is a strategist’s projection, however, rather than an official government forecast or a guaranteed market outcome.

 

Connors has identified another potential development that could reinforce his thesis: changes to the supplementary leverage ratio, or SLR. The requirement influences the amount of leverage banks can use relative to their capital and therefore affects their ability to hold and intermediate assets such as Treasury securities.

If regulatory changes gave banks greater flexibility to absorb government bonds, Treasury-market liquidity could potentially improve. That could become increasingly important as the government continues to finance large borrowing requirements. Greater banking-sector capacity to hold Treasuries would not automatically push Bitcoin higher, but it could complement the Treasury’s own market-support measures.

The combination of expanded buybacks and a potential adjustment to bank leverage rules is therefore central to Connors’ argument. Instead of viewing Bitcoin’s outlook solely through cryptocurrency-specific developments, his framework connects BTC to the broader plumbing of the U.S. financial system.

That distinction matters because a stronger liquidity backdrop would not guarantee a Bitcoin rally. Inflation, Federal Reserve policy, economic growth, Treasury issuance and investor positioning would continue to influence markets. Nevertheless, if several of these factors move in Bitcoin’s favor simultaneously, the cryptocurrency could receive a stronger macro tailwind.

 

Alongside the longer-term liquidity story, Bitcoin’s immediate price structure could amplify volatility. The $72,000 area has attracted attention because of reported concentrations of leveraged short positions. If BTC remains above that level, traders positioned for a decline may be forced to reduce those positions, creating additional buying demand.

A short squeeze can accelerate an existing move, but it does not necessarily establish a durable trend. Sustained gains generally require broader demand rather than relying exclusively on derivatives liquidations. Bitcoin therefore needs to maintain its recent strength while investors evaluate whether the Treasury announcement represents a lasting improvement in financial conditions.

Connors has also warned that progress on the CLARITY Act could be crucial for Bitcoin’s near-term direction. A lack of movement around the September 15 timeline could create renewed uncertainty for the crypto market, potentially offsetting some of the optimism generated by Treasury policy.

 

Treasury buybacks have introduced a significant new variable into Bitcoin’s macroeconomic outlook. The increase in long-duration purchases could improve Treasury-market liquidity and potentially reduce some pressure associated with elevated borrowing costs, although the program is not equivalent to quantitative easing.

Mark Connors’ $180,000 projection depends on a broader improvement in liquidity, potentially supported by larger Treasury purchases and changes to bank leverage rules. Bitcoin’s ability to hold recent gains, combined with developments surrounding the CLARITY Act and broader financial conditions, will determine whether that bullish scenario gains credibility. For now, $180,000 remains a forecast, but Treasury policy has given Bitcoin investors another major macro factor to watch.