The 30-year US Treasury yield has surged to 5%, a level only reached twice in the past two decades, prompting concerns among crypto analysts about the potential impact on bitcoin. The yield increase is attributed to a combination of factors, including dissent within the Federal Reserve, rising oil prices, and growing long-term inflation expectations. As a result, bond yields are becoming more attractive, potentially leading to a capital rotation out of risk assets like bitcoin.
According to experts, this shift could continue to pressure crypto valuations, especially if the US dollar remains strong and interest rates stay high. The rise in bond yields is not limited to the US, with other countries like the UK also experiencing similar trends. The Federal Reserve's decision to maintain interest rates, coupled with internal dissent, has contributed to the surge in bond yields, making them more appealing to investors and potentially detrimental to bitcoin and other risk assets.