Bitcoin’s Surge Depends on TGA Liquidity Discussions as $850B Milestone Approaches

BitMEX co-founder Arthur Hayes believes that Bitcoin could soon continue its upward movement as the U.S. Treasury General Account (TGA) approaches its target balance of $850 billion. According to Hayes, the TGA's recent liquidity absorption—where funds are held by the Treasury instead of flowing through private markets—has temporarily dampened market momentum. With the TGA’s balance surpassing $807 billion by late September 2025, Hayes contends that easing this liquidity pressure will "restart the uptrend," creating a favorable climate for risk assets such as

. The TGA, the U.S. government's main account at the Federal Reserve, has played a significant role in shaping market liquidity since the Treasury began refilling it in 2025.

The process of replenishing the TGA has coincided with declines in Bitcoin and other high-risk investments. Bitcoin retreated to $113,500 in September 2025, down from previous peaks above $124,000, as shrinking liquidity put pressure on speculative trades. This mirrors broader financial trends, such as the Nasdaq’s 1.4% drop, and highlights how liquidity impacts asset prices. Hayes links this to the Treasury issuing new debt to refill the TGA, effectively pulling cash from the financial system. However, with the refill nearly finished, analysts predict that the liquidity squeeze will reverse as the TGA stabilizes.

Recent rate reductions by the Federal Reserve have reinforced the positive outlook. In September 2025, the Fed lowered rates by 25 basis points—the first decrease since 2024—signaling a move away from a period of tightening. Historically, such policy shifts have supported riskier assets, including Bitcoin, by reducing borrowing costs and promoting inflows into speculative markets. There is strong market anticipation for further reductions, with 91.9% of traders expecting a 50-basis-point cut at the October FOMC meeting, based on

data. The Fed’s new easing cycle is seen as a potential driver of renewed liquidity, which could power a new Bitcoin surge as the TGA refill wraps up.

Some experts, however, remain unconvinced about the direct connection between TGA liquidity and Bitcoin’s price action. André Dragosch, Bitwise’s European research director, dismissed the relationship as “useless,” suggesting that overall liquidity only loosely correlates with crypto markets. Macro analyst Tomas also cautioned that the TGA refill might further tighten liquidity, posing challenges for Bitcoin. This ongoing debate reflects differing perspectives on how government spending and monetary policy interact. While Hayes and supporters interpret the TGA’s stabilization as a signal for renewed risk-taking, critics stress the complex nature of liquidity flows and the risk that geopolitical or economic surprises could disrupt the outlook.

The likelihood of a Bitcoin rally is also influenced by broader economic shifts. Money market funds hit a record $7.5 trillion by mid-September 2025, with much of the capital sitting in low-risk vehicles. As investor appetite for risk returns, these funds could shift into stocks, bonds, or crypto, further boosting prices. Hayes has consistently argued that Bitcoin’s value is closely tied to expectations of future fiat money supply, positioning it to benefit as the Fed injects more liquidity. Meanwhile, analysts like Jamie Coutts from Real Vision have predicted Bitcoin could surpass $132,000 by the end of 2025 if current money supply trends persist, strengthening the optimistic outlook.

The dynamics between the TGA, Fed policy, and Bitcoin remain in the spotlight for investors. While the Treasury’s refill has presented near-term challenges, the combination of a steady TGA, lower interest rates, and renewed liquidity could pave the way for Bitcoin’s next rally. Nonetheless, uncertainties linger. The Fed’s lack of consensus on future rate moves and the risk of stagflation—a scenario with high inflation and slow growth—add to the unpredictability. At present, markets are betting on further monetary easing, leaving Bitcoin’s future path dependent on whether liquidity improvements outweigh larger economic risks.