Viewpoint: The Bessen effect makes it difficult for Bitcoin to return to a true bull market; the main reason for the price increase is short covering

Bloomberg reporter Emily Nicolle stated that Bitcoin recently rose 23% in a single week, marking the largest weekly increase in over three years and ending a period of stagnation since summer. U.S. Treasury Secretary Janet Yellen proposed expanding the scale of long-term Treasury bond repurchases, prompting market concerns about U.S. debt and dollar depreciation, which drove funds toward alternative assets like Bitcoin. However, after Bitcoin surpassed $80,000, it has stabilized again, and this catalyst alone is insufficient to bring the market back to a true bull market state.

Nicolle pointed out that the narrative of Bitcoin as a hedge against the dollar and inflation still lacks sustainability. After Trump reiterated threats of tariffs against China last October, Bitcoin fell over 12% within 24 hours, while gold reached an all-time high during the same period. Since 2026, gold has cumulatively risen over 7%, while Bitcoin, even accounting for the recent rebound, has still fallen nearly 10%. She believes that the simultaneous rise of gold and Bitcoin last week does not prove that both have the same safe-haven properties, as much of the current crypto market rally is driven by short sellers being forced to cover their positions. Strategy Chairman Michael Saylor called on traders to continue buying Bitcoin during the rise, but his company did not increase its holdings accordingly.

In addition, the CLARITY cryptocurrency market structure bill remains stalled due to disagreements over ethical provisions, with the Senate expected to reconsider it by mid-September, leaving limited time before the midterm elections in November. Bitcoin has yet to establish a stable and convincing value narrative, and in daily payments, users still prefer to use stablecoins or cash.