Bitcoin just added about $150 billion in value in less than 24 hours.
That’s a ridiculous amount of money.
For some perspective, $150 billion is more than the entire value of companies like Starbucks (SBUX), UPS (UPS) and Anheuser-Busch (BUD).
Bitcoin added that much in less than a day. Naturally, everybody wants to know why.
Bloomberg has an answer.
But some of the smartest people I speak to in the bond market have a very different one.
And I think it’s worth understanding both.
What Bloomberg Says
Bloomberg reported that Bitcoin was surging because investors were getting excited about friendlier cryptocurrency rules coming out of Washington D.C.
There was a big meeting planned at the White House with executives from the crypto industry. The thinking was pretty simple.
If the government makes it easier for people and companies to own, trade and build businesses around crypto, that’s probably good for Bitcoin.
Makes sense.
But here’s where things get interesting.
The people I speak to who spend their days watching the bond market aren’t talking about the White House crypto meeting.
They’re talking about the U.S. Treasury.
Specifically, they’re talking about interest rates.
This sounds boring.
Stick with me.
Imagine you want to buy a house and the bank tells you your mortgage rate is 5%. Then imagine they tell you it’s 8%.
It’s the same house, the same family, and the same paycheck. But suddenly that house costs you a lot more every month.
Interest rates matter.
Now imagine that happening across the entire economy: homes, cars, businesses, government debt… everything.
That’s why investors pay so much attention when longer-term interest rates start shooting higher.
And the Treasury just sent a message that people I speak to are interpreting as, “We’re not going to just sit here and watch that happen.”
They announced plans to increase certain purchases of government bonds.
You don’t need to understand the plumbing of the bond market to understand why investors care.
More buying of bonds can help support bond prices. And when bond prices rise, their interest rates, or “yields,” fall.
That’s the important part.
If the market believes the government is going to push back against rapidly rising long-term rates, that can change the math for everything else investors own.
Including Bitcoin.
So Bloomberg is looking at Washington and saying, “Crypto regulation.”
The bond guys I talk to are looking at Washington and saying, “Lower interest rates.”
Maybe they’re both right. But then I look at the chart.
And that’s where this gets even more interesting.
Bitcoin Had Already Picked Its Spot
Markets have memories.
Certain prices become important because buyers and sellers keep showing up there.
Think about a house in your neighborhood that keeps going on the market for $600,000.
Every time the seller asks for more, nobody buys it.
Eventually $600,000 becomes the number everybody knows.
Then one day somebody finally pays $650,000.
Something changed.
That’s basically what happened with Bitcoin around $60,000.
Years ago, Bitcoin kept running into trouble around this area. It would get there, and sellers would show up.
Eventually, in late 2024, Bitcoin broke out through that level.
And something funny happens in markets all the time. An old ceiling can become a new floor:
Look at the red arrows on the chart. That’s Bitcoin running into the ceiling.
Now look at the green arrows. That’s Bitcoin coming back down to the same area years later and finding buyers.
Same neighborhood, completely different job.
There’s also some math behind this level. We call that Polarity.
The green label on the chart shows something called the 61.8% Fibonacci retracement.
Don’t worry about the fancy name.
It simply means that after Bitcoin’s huge run from its 2022 low to its 2025 high, it gave back a large portion of that advance and landed near a level traders have been watching for generations.
And wouldn’t you know it? That’s almost exactly where the old ceiling was, too.
That’s what gets my attention.
Bitcoin didn’t suddenly find buyers in the middle of nowhere.
Buyers showed up at an area where we’ve already seen them show up before.
Then the Treasury made an important announcement.
Then Bitcoin exploded higher.
And roughly $150 billion in value showed up in less than 24 hours.
Bloomberg says it’s about crypto regulation.
The people I speak to in the bond market say it’s about interest rates.
The chart says buyers were already waiting.
I don’t know that we need to pick just one.
Markets are usually more complicated than the headline we get the next morning.
But when $150 billion shows up overnight, I want to know what changed.
And there are a lot more clues than just a crypto meeting at the White House.
Stay sharp,
JC Parets, CMT
Founder, TrendLabs