Bitcoin Tops $80,000 as Treasury Weighs Tapping $950 Billion Cash Account to Fund Bigger Bond Buybacks

Bitcoin climbed above $80,000 as the U.S. Treasury examined whether it could draw on the Treasury General Account (TGA) at the Federal Reserve to help fund an expanded bond buyback program, according to two senior officials who spoke to CNBC. The officials did not say how much of the cash balance might be used or when. Reuters estimated the TGA at about $940 billion as of last Wednesday, and CNBC later reported a balance near $950 billion. The Treasury said on Aug. 19 it will at least double buybacks aimed at improving liquidity in 10- to 30-year Treasuries, lifting each operation to $4 billion from $2 billion. The larger operations are scheduled to begin Sept. 9 and run through Nov. 4. The Treasury has not yet carried out any of the enlarged purchases. Long-end yields moved sharply around the announcement. The 30-year Treasury yield hit 5.337%, the highest since 2007, then slipped to about 5.18% after the buyback plan was announced. It was around 5.24% on Monday. The 10-year yield traded near 4.70% on Monday. Treasury Secretary Scott Bessent said purchases could ultimately exceed $4 billion. He said the goal is to improve liquidity in segments of the Treasury market strained by thin summer trading and heavy corporate bond issuance. The Treasury plans to keep holding regularly scheduled auctions, including sales of longer-dated debt, and may consider further adjustments at the next quarterly refunding. The policy discussion comes as U.S. national debt crossed $40 trillion last week, with about $32.3 trillion held by the public. U.S. technology companies have issued roughly $220 billion of debt this year to finance artificial intelligence infrastructure. Using the TGA directly could, at least initially, reduce the need to issue additional short-term Treasury bills to finance buybacks. The account sits above the Biden administration's stated target range of about $550 billion to $600 billion and is used to pay federal salaries, contractors, interest and other obligations. Any significant drawdown would eventually need to be rebuilt through tax receipts or additional borrowing, since the Treasury cannot create reserves the way the Federal Reserve can. Market participants cautioned against equating the cash balance with a buyback commitment. The roughly $950 billion TGA figure is not an announced $950 billion bond-buying program, and officials have not suggested anything close to full deployment. Robin Brooks of the Brookings Institution said tapping the TGA could strengthen expectations for implicit yield caps, a dynamic that could weigh on the dollar and support precious metals. The Federal Reserve has not joined any Treasury intervention. In crypto markets, Bitcoin rose more than 4% over the past 24 hours. With August gains building, the cryptocurrency is on track for its strongest August since 2017. Gold has also advanced as investors revived the so-called debasement trade. Strive CEO Matt Cole said Bitcoin's gains relative to gold bolster the bullish case for the asset, pointing to the BTC/gold ratio as an early-cycle signal in the prior market run. Andre Dragosch, head of research at Bitwise Europe, said the firm's crypto sentiment index briefly hit its highest level since late 2024. He added that a pullback or consolidation now looks likely, even if the broader recovery remains intact. Beyond the current plan, the Treasury retains other levers, including increasing buyback sizes further and adjusting the maturity mix of government borrowing.