The 30-year US Treasury yield has surged to 5%, a level only seen twice in the past two decades, sparking concerns among crypto analysts that rising yields may negatively impact bitcoin. As yields become more attractive, investors may shift their capital away from riskier assets like cryptocurrencies. This trend is further exacerbated by a strengthening Dollar Index and rising oil prices, which are fueling long-term inflation expectations and pushing bond yields higher.
According to experts, the dynamic is straightforward: as long as yields remain appealing and monetary policy stays tight, capital will seek safer alternatives, putting pressure on assets like crypto. The rise in bond yields typically hurts risk assets, including bitcoin, as investors opt for the almost risk-free return offered by bonds. With the 10-year yield also elevated, financial conditions are tightening, making borrowing more costly and discouraging risk-taking. The recent surge in oil prices, which reached their highest level since 2022, is also contributing to higher inflation expectations, further driving yields upward.
As a result, the macro backdrop remains a significant headwind for crypto, with experts warning that the current environment favors yield and safety over volatility.