Bitcoin has climbed above $80,000 for the first time since May 15, extending a powerful recovery from the sharp selloff that pushed the cryptocurrency below $58,000 around late June and early July.
The world's largest cryptocurrency has now gained roughly 38% from its recent lows, with buying momentum accelerating over the past week. The move represents a significant turnaround after months of pressure from restrictive financial conditions and weaker risk appetite.
The recovery has also spread across the broader crypto market, suggesting that investor confidence is beginning to return after the prolonged correction.
Spot Bitcoin ETF Demand Returns
One of the clearest signs of improving sentiment has come from U.S.-listed spot Bitcoin exchange-traded funds. The products attracted approximately $1.9 billion in net inflows last week, their strongest weekly performance since October 2025.
The renewed inflows suggest that traditional and institutional investors are returning to Bitcoin exposure as prices recover. ETF demand has become an increasingly important source of liquidity for Bitcoin since spot products opened another regulated route into the asset for institutional portfolios.
The inflows also follow months in which geopolitical uncertainty, falling crypto prices and tighter financial conditions limited investor appetite. With Bitcoin moving decisively higher again, ETF flows could become an important indicator of whether the rally has staying power.
Treasury Policy Helps Fuel Crypto Rally
The broader market rebound accelerated as U.S. Treasury yields declined, easing some of the financial pressure that had weighed on cryptocurrencies and other risk assets.
The U.S. Treasury recently announced that it would double the size of planned buybacks for longer-dated government bonds through early November. Those purchases are expected to be financed partly through increased issuance of shorter-term government debt.
While the program is different from traditional Federal Reserve quantitative easing, greater support for long-dated Treasury market liquidity has helped create a more favorable backdrop for risk assets.
Bitcoin received another boost on Monday after the Treasury indicated it could potentially use funds from its nearly $1 trillion Treasury General Account to support the buyback operations.
The combination of lower yields, improving liquidity conditions and renewed institutional demand helped provide the momentum needed for Bitcoin to finally break through the $80,000 level.
Bitcoin Rebounds From Below $58,000
The rally marks a dramatic reversal from conditions earlier this summer. Bitcoin briefly dropped below $58,000 during its late-June and early-July decline, extending a correction that had already placed significant pressure on leveraged traders and long-term holders.
Since then, the market has steadily recovered before accelerating sharply in recent sessions. The approximately 38% rebound from those lows has pushed Bitcoin back toward levels last seen in May.
The move also comes after analysts began identifying signs that the prolonged correction could be approaching exhaustion. VanEck recently reported that eight of its 12 Bitcoin capitulation indicators were flashing, suggesting the market could be transitioning toward an accumulation phase.
However, whether the latest rally develops into a longer-term trend could now depend heavily on macroeconomic data and expectations surrounding U.S. monetary policy.
Inflation Data Becomes the Next Major Test
Investor attention is turning toward several important economic releases this week, particularly the Personal Consumption Expenditures price index, the Federal Reserve's preferred inflation measure.
Markets will be watching core PCE closely for evidence that underlying inflation pressures are continuing to cool.
Infinox regional director Thadeu Dos Santos said “Core PCE will be closely watched” for indications about the direction of inflation. A stronger-than-expected reading could push Treasury yields and the U.S. dollar higher, potentially creating renewed pressure on crypto markets.
Softer inflation, by contrast, could reduce expectations for additional monetary tightening and provide another supportive catalyst for Bitcoin and other risk assets.
After recovering from below $58,000 to above $80,000, Bitcoin has regained substantial momentum. The next challenge will be determining whether ETF demand and improving liquidity conditions can sustain the recovery as investors digest the latest inflation data.
