Bitcoin extended its recent recovery on Thursday, moving closer to the $80,000 mark as investors increasingly turned to scarce assets viewed as potential protection against currency debasement.
The cryptocurrency has maintained a steady upward trend since last week, while institutional demand for Bitcoin and gold has strengthened. Bloomberg senior ETF analyst Eric Balchunas said the renewed interest reflects a broader “debasement trade” across currencies and financial markets.
Bitcoin’s recovery has also prompted some investors to lock in gains. The cryptocurrency’s Spent Output Profit Ratio (SOPR) has moved above 1, suggesting that holders are beginning to sell Bitcoin at a profit following its latest advance.
Bitcoin Gains From Growing Debasement Trade
The debasement trade refers to an investment strategy that favors scarce or hard assets when investors expect the purchasing power of currencies or the value of traditional financial assets to weaken.
Persistent US inflation and federal government debt above $40 trillion have contributed to those concerns, increasing interest in assets such as gold and Bitcoin.
Balchunas highlighted the trend in a post on X on Wednesday, pointing to strong institutional demand for both assets.
According to data shared by the Bloomberg analyst, gold and Bitcoin exchange-traded funds attracted more than $7 billion in combined inflows over the previous five trading days. It was the strongest five-day inflow on record, with the buying largely attributed to the growing debasement trade.
Balchunas also argued that Bitcoin’s next major rally could be increasingly linked to its perception as an asset capable of protecting against currency debasement. That narrative could become more important than shorter-term catalysts, including the Clarity Act, continued ETF adoption and Bitcoin purchases by Strategy.
Bitcoin ETF Inflows Remain Strong
Institutional demand has remained supportive of Bitcoin’s recovery.
Data from SoSoValue showed that US spot Bitcoin ETFs recorded net inflows of approximately $232.12 million on Wednesday. The figure extended the sector’s positive inflow streak to eight consecutive trading days.
The continued ETF demand provides an important source of buying pressure as Bitcoin approaches the psychologically significant $80,000 level.
Profit-Taking Emerges as Bitcoin Recovers
Despite the renewed buying interest, on-chain data indicates that some Bitcoin holders have started taking profits.
Bitcoin’s Spent Output Profit Ratio, or SOPR, compares the value of coins when they are spent with the price at which they were originally acquired. A reading above 1 generally means coins are being sold at a profit.
The metric was around 1.01 after moving above 1 on August 20, suggesting that profit-taking has begun as Bitcoin’s price rebounds.
A sustained SOPR reading above 1 is generally viewed as a constructive sign during a recovery because it indicates that investors are realizing gains while underlying demand remains strong enough to absorb the additional selling pressure.
$80,000 Becomes the Key Technical Level
Bitcoin’s technical setup remains tilted toward further gains, but traders are closely watching the $80,000 resistance level for confirmation of a stronger breakout.
A decisive move above that threshold could reinforce bullish sentiment and potentially attract additional buying from momentum-focused investors. However, continued profit-taking could create short-term resistance as existing holders use the recovery to secure gains.
For now, Bitcoin’s combination of strong ETF inflows, renewed institutional interest and the broader debasement narrative is keeping the cryptocurrency firmly in focus as it approaches $80,000.
