U.S. May Expand BTC Holdings
On Thursday, Treasury Secretary Scott Bessent appeared to walk back earlier comments about the U.S. Strategic Bitcoin Reserve. In the morning, he stated the reserve would remain at its current $15–$20 billion in holdings, with no plans for additional purchases. By afternoon, however, Bessent said the Treasury is “committed to exploring budget-neutral pathways” to acquire more Bitcoin, supplementing coins seized or forfeited to the government, which will serve as the reserve’s base.
President Trump authorized the reserve in March via executive order, a move Bessent has strongly supported. The policy shift comes amid market volatility — Bitcoin hit a record $124,000 overnight before sliding to around $118,000. The drop followed hotter-than-expected U.S. Producer Price Index data, dampening expectations for near-term Federal Reserve rate cuts. The evolving stance on Bitcoin accumulation signals that the government may still be open to expanding its crypto holdings despite earlier indications to the contrary.
Google Takes 8% TeraWulf Stake
TeraWulf (WULF) has inked two 10-year high-performance computing colocation deals with AI cloud platform Fluidstack, securing roughly $3.7 billion in contracted revenue, with potential to reach $8.7 billion if extended. As part of the arrangement, Google will backstop $1.8 billion of Fluidstack’s lease obligations, enable project debt financing, and acquire an 8% equity stake in TeraWulf via warrants for about 41 million shares.
The agreements will deliver over 200 MW of IT load at TeraWulf’s Lake Mariner data center in Western New York, a liquid-cooled, hyperscale-ready facility tailored for AI workloads. Phase one (40 MW) is set for H1 2026, with full buildout by year-end.
CEO Paul Prager called the partnership a “defining moment” for the company. The leases, featuring annual escalators, are expected to generate 85% net operating income margins, or about $315 million annually. TeraWulf shares jumped 22% pre-market to $6.68 following the announcement.
Hot PPI Data Hits Crypto
U.S. inflation concerns flared Thursday as July Producer Price Index (PPI) data came in far hotter than expected, weighing on crypto and other risk assets. Headline PPI surged 0.9% month-over-month versus forecasts of 0.2%, with the year-over-year rate jumping to 3.3% against expectations of 2.5%. Core PPI, excluding food and energy, also rose 0.9% — sharply above the 0.2% estimate.
Bitcoin, already off its overnight record above $124,000, dropped below $119,000 after the release. Ether slid nearly 4% to $4,550, while solana and XRP also saw sharp declines.
Labor market data added to the hawkish outlook, with jobless claims at 224,000 — slightly better than expected — underscoring ongoing tightness. The stronger PPI and firm labor market reduced odds of an imminent Federal Reserve rate cut, with September’s cut probability dipping from 100% to 96% per CME FedWatch. Stocks fell, the dollar strengthened, and the 10-year Treasury yield climbed to 4.25%.
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