Market expectations on the Federal Reserve’s next interest rate helped propel Bitcoin (CRYPTO: BTC) to trade above $72,000 Thursday morning. That’s up 14.8% on the week and on pace for its biggest weekly gain since November 2024 when Donald Trump won the presidential election.
Chart: Bitcoin Breaks $72,000, On Pace For Its Best Weekly Surge Since November 2024
The Treasury Intervened, The Fed Didn’t.
On Wednesday, the U.S. Treasury said it will at least double the size of its liquidity-support buyback operations in longer-dated government bonds, raising the maximum from $2 billion to at least $4 billion per operation starting Sept. 9.
A buyback is the government purchasing its own outstanding debt back from investors, putting cash in their hands. Long-end yields fell immediately.
The widely followed iShares 20+ Year Treasury ETF (NASDAQ:TLT) more rose 1.7%, its best single day since February 2025.
The dollar weakened.
Traders already had a nickname for this move: QE Lite.
Add a White House meeting where Trump pressed Congress to advance crypto market-structure legislation, and roughly $1.4 billion of bearish bitcoin positions were force-closed in about an hour, according to Coinglass data cited by Bloomberg — the largest wave of short liquidations in its records going back to 2021.
Coinbase Global Inc. (NASDAQ:COIN) rose 10% and Strategy Inc. (NASDAQ:MSTR) gained 13%.
Warsh Promised Price Stability; He Has Not Promised Rate Hikes
Minutes from the July meeting showed some officials judged financial conditions might not be restrictive enough to return inflation to the 2% target. Participants said “policy tightening would likely be necessary if inflation did not decline.”
The committee held rates at 3.50%–3.75% on a 9-3 vote, with three regional bank presidents preferring a quarter-point increase.
Yet nothing in the record commits the Fed to actually moving in September.
That gap runs straight to the top.
Chair Kevin Warsh has repeatedly pledged to deliver price stability and return inflation to target. He has offered almost no guidance on how, declining to submit individual projections in June and giving no steer on the next move since.
A promise about the destination is not a signal about the path. Traders have stopped waiting for one.
On prediction market Polymarket, the odds of a September hike have fallen to roughly 25%.
More telling, the probability of any rate increase across all of 2026 has slipped to about 50%, down from 64% on Aug. 6.
That is not a central bank convincing anyone it wants tighter policy.
Bitcoin, Gold And The Everything Rally
Bitcoin is the cleanest read on that shift because it has no earnings and no coupon. It moves on liquidity and on doubts about the currency in which it is priced.
It is not moving alone. Gold pushed above $4,500 an ounce, its highest since early June, after jumping more than 4% Wednesday.
Risk assets and debasement hedges rising together is unusual. It happens when investors conclude money will stay looser than officials say it will.
That is how an “everything rally” gets built.
The Fed is talking tight. The market is trading loose.
Image: Shutterstock
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