Bitcoin, gold gain as treasury move shakes markets

Bitcoin and gold experienced significant gains this week, as market turmoil surrounding the bond market drove up their values. Bitcoin, which had plummeted from a January high of $95,000 to below $60,000 by the end of June, surged above $77,000 on Friday. Similarly, gold's price rose to over $4,661 on Friday, following its January high of $5,300.

The rally in these two assets was partly due to the Treasury Department's announcement to increase its purchases of long-term Treasurys, intended to stabilize bond markets after a sharp sell-off. This move raised concerns about the government's efforts to lower borrowing costs amid inflation, potentially hindering the Federal Reserve's ability to combat inflation through interest rate hikes.

Additionally, the national debt surpassed the $40 trillion mark just five months after hitting a record $39 trillion in March, causing widespread inflation anxiety, particularly due to the ongoing conflict in Iran and rising energy prices. As investors sought alternatives to the dollar and government bonds, gold and bitcoin saw substantial increases, with bitcoin jumping more than 20% this week.