The 30-year US Treasury yield has reached 5%, its highest level since July 2025, prompting concerns among crypto analysts about the potential impact on bitcoin. This surge in bond yields is attributed to a combination of factors, including internal dissent within the Federal Reserve, elevated oil prices, and rising long-term inflation expectations.
As a result, bitcoin, which is already under pressure, may face further headwinds. According to experts, the dynamic is straightforward: as long as yields remain attractive and the Fed's monetary policy stays tight, capital will seek alternatives to risk, putting pressure on assets like crypto. The rise in bond yields typically hurts bitcoin and other risk assets, as it makes bonds a more attractive investment option. With the 30-year Treasury yielding 5%, investors may opt for this almost risk-free return over bitcoin, leading to capital rotation out of non-yielding risk assets.
Furthermore, rising yields also weigh on gold, which has fallen to a one-month low. The situation is exacerbated by the fact that the 10-year yield, a benchmark for borrowing costs, is also elevated, pointing to financial tightening and disincentivizing risk-taking. The Fed's decision to keep rates unchanged, coupled with internal dissent, has pushed up expectations for higher-for-longer interest rates, contributing to the surge in bond yields.
As a result, the macro backdrop remains a headwind for crypto, with experts warning that the market may favor yield and safety over volatility.