Bitcoin and Ether have staged their strongest rally in more than two years, so highlights IG's Chris Beauchamp, who puts the quite sudden moves down to fears of dollar "debasement" reigniting crypto's core investment case.
The broker's Crypto Weekly note, published Monday, pointed to US Treasury secretary Scott Bessent's intervention in the Treasury market as the trigger, reviving a theme that plays directly into what Beauchamp calls the asset class's "entire raison d'être".
Cryptocurrencies had spent months drifting lower, overshadowed by gold and the artificial intelligence trade, before this shift in narrative changed the picture.
"For months, the question has been what, if anything, can revive cryptocurrencies from their ongoing downturn", Beauchamp said, adding that recent strength in inflows helped drive the move.
He argues retail enthusiasm alone won't sustain the bounce; institutional flows are the key ingredient, and the note says outflows appear to have been staunched with early signs of an inflow revival taking hold.
Beauchamp is watching flow data closely in the coming week to gauge whether that trend holds.
Beyond crypto, the note flags incoming Fed chair Warsh's debut appearance at Jackson Hole as events likely to shape sentiment, with investors parsing his remarks for signs of coordination, or friction, between the Federal Reserve and the Treasury.
