The 30-year US Treasury yield has reached 5%, a level only seen twice in the past two decades, prompting concerns among crypto analysts. This surge in bond yields, combined with a strong US dollar and rising long-term inflation expectations, may lead to a decline in bitcoin's value. As bond yields increase, they become a more attractive investment, potentially causing capital to flow out of riskier assets like bitcoin.
Experts predict that this trend will continue as long as yields remain high and the Federal Reserve maintains its tight monetary policy. The rise in bond yields is not limited to the US, with yields also increasing in the UK and other parts of the world. The recent surge in oil prices has further fueled inflation expectations, contributing to the increase in bond yields. As a result, the macroeconomic environment remains challenging for bitcoin and other risk assets.