Bitcoin Tops $80,000, Ethereum Jumps 30% in a Week as Treasury Buyback and SEC Crypto Rules Fuel Rally

Bitcoin cleared $80,000 on Tuesday, August 25, its highest level since May, capping its strongest three-day rally since 2023. It's up roughly 20% over the past three trading sessions alone, according to the Epoch Times. Ether followed, trading near $2,478 to $2,500 after gaining about 30% over the past week, according to crypto.news and CoinDesk data cited by CNBC Africa.

Gold hit a three-month high the same morning, with December futures opening at $4,710.10 per troy ounce on Tuesday, up 39.9% over the past year, according to Yahoo Finance. When gold and bitcoin rally together, money is running from something.

What's actually driving it

Start with the Treasury. On August 19, the department announced it would roughly double the size of its longer-dated bond buybacks, from $2 billion to at least $4 billion for 10-to-30-year securities, starting September 9, according to crypto.news, citing the official Treasury announcement. Long-term yields fell on the news, with the 30-year dropping from above 5.30% to around 5.19%.

The buyback increase hasn't even taken effect yet. It doesn't start until September 9. So the entire rally in bitcoin, ether, and gold happened on the announcement alone, not on any actual liquidity hitting the market. This is a market betting on the direction of government debt policy, not reacting to real cash flow.

Tom Essaye, president of the Sevens Research Report, called it the "debasement trade" in a note cited by the Epoch Times. His read: capital is rotating out of traditional market leadership and into scarce assets that hedge against inflation and growth risk. Capital is moving into anything that can't be printed.

Regulation played a role too. SEC Chairman Paul Atkins announced a new digital asset framework on August 18, which he said in a statement provides "clear pathways to raise capital under the federal securities laws." Per crypto.news, the SEC proposed two exemptions: a startup carve-out allowing up to $5 million raised over four years, and a broader fundraising route capped at $75 million annually. President Trump has also pushed Congress to pass the Clarity Act, legislation meant to codify crypto market rules.

The money behind the move

This wasn't retail speculation alone. U.S. spot bitcoin ETFs pulled in $1.92 billion in net inflows last week, the largest weekly haul since October, according to CNBC Africa. Spot ether ETFs added another $697.2 million over the same stretch, their strongest week of 2026, according to crypto.news. Combined, that's about $2.6 billion in institutional money flowing into the two biggest cryptocurrencies in five trading days.

At the same time, more than $4 billion in leveraged short positions got liquidated, according to the Epoch Times, with CoinGlass data showing short sellers lost nearly $2.7 billion within a single 24-hour window at the peak of the squeeze. Forced buying on top of genuine demand explains why the move happened so fast.

One name notably absent from the buying: Strategy, the largest corporate holder of bitcoin, hasn't purchased any bitcoin in two weeks, according to Fundstrat's research cited by CNBC Africa. Fundstrat argued that's actually bullish. If Strategy starts buying again while ETF demand holds, that's another leg up in the tank. If it doesn't, this rally is running on ETF and short-covering fuel alone.

Reasons for caution

Not everyone is convinced this holds. BTIG pointed out, per CNBC Africa, that a similar bitcoin surge in January 2023 initially faded before the asset found support at its 200-day moving average. Ethereum's own charts are flashing overbought signals, with crypto.news noting the daily RSI pushed into extreme territory before easing back toward 70, and price consolidating in a tight band between $2,420 and $2,530 since August 22.

Bitcoin's own momentum stalled by Tuesday afternoon. Dow Jones Newswires, carried by Morningstar, reported the rally "paused" after the push above $80,000, in the "absence of new positive catalysts." Without another Treasury move, SEC ruling, or ETF inflow surge, the rally may need a fresh trigger to keep climbing toward Ethereum's next resistance zone near $3,000 or bitcoin's prior highs above $100,000.

The bigger fight is happening one level up. Legendary investor Stanley Druckenmiller, who once mentored Treasury Secretary Scott Bessent, has criticized Bessent's bond-market maneuvers, according to Dow Jones Newswires. Meanwhile Boston Fed President Susan Collins said the Fed may need to tighten policy again without clearer progress on inflation. If the Fed moves against the market's current bet on lower rates and looser Treasury policy, this entire debasement trade, gold, bitcoin, and ether alike, gets tested fast.