Bitcoin experienced another significant increase on Friday, as investor optimism rose with renewed prospects for cryptocurrency legislation in the United States and an unexpected action by the US Treasury to boost its bond buybacks.
The largest cryptocurrency by market value climbed 6.9% to $77,675.94, marking its highest point since May. This latest gain adds to a rise of over 20% since Wednesday.
Friday represented the third consecutive day of Bitcoin gaining more than 5%, extending a robust rally throughout the cryptocurrency market.
Trump Advocates for Crypto Regulation
The surge came after US President Donald Trump urged lawmakers on Wednesday to pass the Clarity Act, legislation designed to provide clearer guidelines for the cryptocurrency industry.
Although the bill has faced delays in the US Senate, Trump’s backing has revived hopes among investors for progress in crypto regulations, which could pave the way for broader institutional and mainstream adoption of digital assets.
Treasury’s Actions Enhance Risk Appetite
Bitcoin also gained from the US Treasury’s decision to increase its government bond purchases. This move aims to help lower long-term borrowing costs after the 30-year US Treasury bond yields reached heights unseen since 2007.
Lower bond yields can diminish the appeal of traditional fixed-income investments, encouraging investors to redirect capital towards higher-risk assets like cryptocurrencies.
Analysts Identify Multiple Rally Drivers
Market analysts point out several factors supporting Bitcoin’s rally: anticipated progress in US crypto legislation, decreasing Treasury yields, and the closing of bearish positions.
Bret Kenwell, a US investment analyst at eToro, noted that optimism about crypto advancements in Washington has significantly boosted Bitcoin’s momentum. He also mentioned that declining Treasury yields and liquidations of short positions have further fueled the rally.
Bitcoin’s recent surge underscores the strong influence of US financial policy developments, interest rates, and regulatory decisions on cryptocurrency markets.
