Treasury Bill Issuance Drives Bitcoin Price More Than Fed Policy, Keyrock Analysis Finds
New research from crypto market maker Keyrock challenges conventional wisdom by identifying T-bill issuance as the primary liquidity driver for Bitcoin prices, showing an 80% correlation since 2021.
Treasury bill issuance, rather than Federal Reserve monetary policy, serves as the dominant liquidity factor influencing Bitcoin's price movements, according to fresh analysis from crypto investment firm Keyrock [1].
The research reveals that T-bill issuance demonstrates approximately 80% correlation with BTC prices beginning in 2021, with the metric leading Bitcoin's price action by roughly eight months [1]. According to researcher Amir Hajian, each 1% shift in worldwide liquidity levels translates to a 7.6% impact on Bitcoin's price during the subsequent business quarter [1].
The mechanism works through government spending that enters the broader economy and eventually flows into risk assets like Bitcoin, while reduced or negative T-bill issuance removes this fiscal support [1]. However, institutional adoption and exchange-traded funds have reduced Bitcoin's responsiveness to liquidity conditions by approximately 23% [1].
Looking forward, Keyrock projects significant liquidity expansion as the United States faces a substantial debt maturity wall within the next four years. The Treasury Department will need to refinance previously low-interest debt at current higher rates, with T-bill issuance expected to reach between $600 billion and $800 billion annually through 2028 [1]. This liquidity injection should impact Bitcoin prices in late 2026 and early 2027, the analysis suggests [1].
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