as growing uncertainty over the US financial health weighed on the dollar and spurred an influx of funds into cryptocurrencies.

The world's largest cryptocurrency rose 2% to $79,119.8 by 12:55 PM Moscow time, briefly reaching a three-month high of $81,300.0.

Tuesday's gains marked Bitcoin's gains in eight of the last nine sessions, as the cryptocurrency has rebounded sharply over the past week. The cryptocurrency also benefited from short-covering after its recent recovery eliminated a large number of short positions.

Bitcoin Soars on Fears of Devaluation Following US Treasury Bond Purchases

Bitcoin's recent rally was largely driven by growing concerns about the US financial health and the dollar's long-term outlook.

These concerns were sparked last week by the US Treasury's plans to essentially double the pace of bond buybacks to curb rising yields.

This move raised concerns that the dollar could bear the brunt of Treasury interventions in bond markets, triggering a so-called "depreciation trade."

"The Treasury's buyback announcement shifted the market narrative from higher yields to a depreciating US dollar, contributing to a weaker US dollar, stronger gold, and higher breakevens. While comparisons to quantitative easing are exaggerated, growing policy uncertainty and questions about the Fed's independence are weighing on the US dollar," OCBC analysts wrote in a note.

This, in turn, has led investors to invest in gold and cryptocurrencies—assets considered largely immune to bond market turmoil.