A top manager responded to a statement by U.S. Treasury Secretary Scott Bessent about plans to regularly repurchase long-term Treasury bonds. The department intends to spend $4 billion on these operations, but the secretary admits the amount could be increased.
According to the head of Risk Dimensions, this step is atypical for the U.S. Treasury and could be a reaction to rising long-term borrowing costs. Connors expects that over time, the volume of government bond repurchases could increase to $10–30 billion per month.
The head of the consulting firm believes that the high yield of Treasury bonds makes them more attractive compared to risky assets, including Bitcoin. Under such conditions, investors may prefer U.S. government debt. Bond repurchases could support their value and restrain further yield increases.
Another factor Connors mentioned was the potential easing of the Supplementary Leverage Ratio (SLR). This regulation limits the volume of assets, including bonds, that banks can hold on their balance sheets relative to their own capital. According to the consulting specialist's estimate, easing the requirements would allow banks to more actively repurchase government debt.
"When that happens, that's when Bitcoin will start moving toward the first target threshold of $180,000," Connors stated.
In the short term, he considers $72,000 an important level for Bitcoin. The top manager named the lack of progress on the CLARITY cryptocurrency regulation bill as a risk for the crypto market. In Connors' opinion, if the consideration of the initiative does not advance, the price of the main cryptocurrency could fall below $72,000.
Earlier, the Head of Digital Assets Research at Standard Chartered, Geoffrey Kendrick, suggested Bitcoin could rise to $100,000 by the end of the year. According to his assessment, increased liquidity in the U.S. government bond market could provide support for the cryptocurrency.
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