During Asian trading hours on September 4th, Bitcoin climbed back above the $81,000 mark, posting a 24-hour gain of approximately 4%. The primary catalyst behind this rally was a shift in interest rate market expectations. According to CME FedWatch data, traders' probability estimate for a Fed rate hike this month has now fallen to around 50%, down from over 63% at the start of the week.
This cooling of rate hike expectations pulled bond yields lower, fueling a broad-based advance across risk assets. Remarks from Federal Reserve Governor Christopher Waller provided the immediate trigger for the market move. He indicated he would support holding rates steady if price pressures continue to ease. Supported by these comments, US Treasuries and gold extended their gains during the New York session, while Asian equities followed suit with the MSCI Asia-Pacific index rising nearly 1%, marking a third consecutive day of gains for global stocks. The US dollar index slid to its lowest point since May, and an Asian currency index touched its highest level since October 2024.
Mainstream cryptocurrencies saw widespread increases. Zcash was the standout performer with a 24-hour surge of nearly 15% and a weekly gain of 20%. HYPE climbed about 6%, XRP added roughly 6%, Ethereum, BNB, and Dogecoin registered gains between 4% and 5%, Solana rose nearly 3%, and Tron advanced more than 1%. Over the weekly timeframe, however, Bitcoin's gain is a modest 1%, Ethereum and XRP are roughly flat, while Solana and Tron have each shed nearly 3%. US spot Bitcoin ETFs recorded net inflows of approximately $277 million on Thursday, after four trading days of alternating inflows and outflows earlier in the week. Whether institutions view this repricing of interest rate expectations as a persistent shift remains to be seen, and upcoming fund flow data will be closely watched.
The Bitcoin-to-gold ratio has simultaneously climbed to 18.17, its highest level since January, meaning one Bitcoin can now purchase more than 18 ounces of gold. Analysts point to a shared driver behind the concurrent rallies: rising concerns over the fiscal health of developed economies. Every major developed economy except Switzerland now has a debt-to-GDP ratio exceeding 100%, with the US leading in primary deficits before interest payments. Policymakers generally favor tackling debt burdens through growth-oriented strategies rather than austerity. US Treasury Secretary Scott Bessent commented at the G20 finance ministers' meeting, stating, "The world is awash in debt... The only way out is to grow our way out of it." Anthony Scaramucci, founder of SkyBridge Capital, reacted on social media, calling Bessent's remarks an inadvertent advertisement for Bitcoin, as it operates independently of the traditional financial system and cannot be devalued by policy decisions.
In the yen, traders increased bets on a Bank of Japan rate hike and remained cautious about potential official intervention, prompting a roughly 2% appreciation in the previous session that erased a month of gradual depreciation. The currency subsequently settled back near 156.35 after touching an intraday high of 155.30. A stronger yen typically drains liquidity from carry trades, but Bitcoin has withstood this shock without surrendering its gains.
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