Bitcoin · U.S. Treasury · CryptoSlate
How $739 billion in new US debt could absorb crypto’s liquidity before buybacks even reach Bitcoin
Compiled by KHAO Editorial — aggregated from 1 source + 5 references discovered via search. See llms.txt for citation guidance.
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The US Treasury expects to borrow $739 billion from July through September while paying investors to hand back some of its older bonds.
Key facts
- The Fed's Aug. 27 H.4.1 release showed the TGA averaging $950.7 billion during the week ended Aug. 26 and standing at $959.4 billion on Wednesday, while reserve balances averaged $2.92 trillion
- The August refunding, for example, comprised a $58 billion three-year note, a $42 billion 10-year note and a $25 billion 30-year bond, producing $28.7 billion of new cash once maturing securities
- If Treasury sells $100 billion of new securities to private investors and buys back $4 billion held by private investors, privately held debt has increased by $96 billion
- Treasury's Aug. 3 borrowing estimate assumes a $950 billion cash balance at the end of September, then projects another $628 billion of borrowing from October through December
Summary
01 Treasury can sell new bonds and buy old ones because the two operations solve different problems. 02 Long-end buybacks are getting bigger as Treasury targets less-liquid corners of the bond market. 03 For Bitcoin, the key isn't the buyback headline, but what happens to yields and available cash. Treasury's Aug. 3 borrowing estimate assumes a $950 billion cash balance at the end of September, then projects another $628 billion of borrowing from October through December.