The global Central Bank "gold rush" may trigger Bitcoin prices to reach a historic high.

Author: Biraajmaan Tamuly, CoinTelegraph; Translated by: Deng Tong, Jinse Finance

• US Treasury bond funds saw an inflow of $19 billion, the highest level since March 2023, with the yield on 30-year Treasury bonds falling by 30 basis points.
• Foreign central banks have reduced their holdings of U.S. Treasury bonds to 23%, the lowest level in 22 years, while gold reserves have reached 18%.
• In a similar trend, Bitcoin soared from $9,000 to $60,000 in 2020, suggesting that a similar outcome may occur in 2025.

A significant shift in global financial trends is occurring, and the price of Bitcoin (BTC) may benefit greatly from it. The latest data shows that net inflows into U.S. Treasury funds reached $19 billion last week, surpassing the peak of $14 billion during the pandemic in 2020, with the four-week moving average rising to $7 billion, the highest level since March 2023.

U.S. Treasury inflow chart. Source: X.com

The 30-year US Treasury yield has fallen by 30 basis points from its peak in April, indicating that bond prices have risen as investors are willing to accept lower returns in exchange for the safety of these bonds. As a safe-haven asset, the demand for US Treasuries has surged, enhancing market liquidity and stability while lowering borrowing costs in the US.

However, foreign central banks have adjusted their strategies, reducing their holdings of U.S. Treasury securities to 23% of the U.S. government's debt, the lowest level in 22 years. This indicates that, although private investors may have driven the inflow of funds, foreign central banks are exiting, possibly due to the ongoing tariff disputes with the U.S.

Foreign central banks' holdings of gold and government bonds. Source: X.com

At the same time, gold's share in global reserves has soared to 18%, reaching a 26-year high, and has increased by 8% since 2015. Among them, China's gold reserves have doubled since 2023, reaching 7.1%.

The trend of de-dollarization worldwide and the favorable pattern for Bitcoin are strikingly similar. During the pandemic in 2020, due to the uncertainty caused by COVID-19, there was a surge in inflows into U.S. Treasury bonds, and the price of Bitcoin skyrocketed from $9,000 to nearly $60,000 by early 2021, while the share of gold in global reserves increased by 14.5% within 18 months.

The current bond market is stabilizing, and the central bank has sparked a gold rush, which means that the next bull market for Bitcoin will also face similar triggering factors. In 2023, due to concerns about economic recession, U.S. Treasury yields rose, and Bitcoin increased by 47% within a month, while the Nasdaq index fell by 8.7%. As yields decline and central banks in various countries hint at a loss of confidence in the dollar, Bitcoin's appeal as a global store of value has increased.

However, if the global market falls into recession in 2025, the bullish sentiment around Bitcoin may be shaken. This is because, as noted last week, during economic downturns, investors tend to prioritize liquidity and traditional safe-haven assets, such as cash or U.S. Treasuries, over speculative assets like Bitcoin.

Bitwise CEO states: Google searches for "Bitcoin" have been low for a long time.

Anonymous global market researcher Capital Flows pointed out that macroeconomic liquidity and market positioning factors have driven the bullish price trend of Bitcoin. The analyst highlighted the impact intensity of BTC in the directional probability skew chart, indicating that it is ready to rise.

The overall macroeconomic positioning of Bitcoin. Source: X.com

This is in line with Bitwise CEO Hunter Horsley's observation: **Search volumes for "Bitcoin" on Google are near long-term lows, suggesting that the impetus for Bitcoin's rally is coming from institutions, advisors, businesses, and countries, rather than retail investors. **

The lack of retail-driven search interest stands in stark contrast to historical trends. In historical trends, Bitcoin's search volume is highly correlated with its price in the previous cycle (r=91%, according to SEMrush data), indicating a shift in market dynamics, with institutional adoption driving demand.