U.S. Short-Term Treasury Issuance Influences Bitcoin Price

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[Cotun] “U.S. Short-Term Treasury Issuance Influences Bitcoin Price”

An analysis has found that the liquidity indicator with the greatest impact on Bitcoin (BTC) prices is the issuance volume of U.S. Treasury bills (T-bills). According to Cointelegraph, cryptocurrency market maker Keyrock said in a report, “Since 2021, U.S. T-bill issuance and Bitcoin prices have shown a high correlation of around 80%. Changes in T-bill issuance tend to lead Bitcoin prices by about eight months, and for every 1% change in global liquidity levels, Bitcoin prices move by approximately 7.6% in the following quarter.”

The report continued, “A significant portion of the U.S. national debt, now at $38 trillion, is set to mature within the next four years. To repay debt borrowed during the era of near-zero interest rates, new debt must be issued. However, with interest rates now significantly higher, the government will need to issue more Treasuries than before to cover both principal and interest payments. Annual Treasury issuance is estimated to remain between $600 billion and $800 billion through 2028, which is expected to have a positive impact on Bitcoin prices between the end of this year and early 2027.”

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