Holger Zschaeptiz, a prominent macro commentator on X, expressed concern after the yield on the 30-year U.S. Treasury note rose to 5% this morning, reaching its highest level since July 2025. This rate has only been tested twice in the past two decades.
Zschaeptiz’s reaction reflects the sentiment of several crypto analysts who view increasing yields as a challenge for Bitcoin (BTC), currently priced at $75,735.40 and recognized as the largest cryptocurrency by market value, as well as a macro asset.
“The situation is straightforward: while yields remain attractive with the Fed maintaining tight monetary policy, capital has viable alternatives to risk assets, pressuring crypto due to its reliance on liquidity and momentum,” explained Diana Pires, chief business officer at sFOX, in an email to CoinDesk. SFOX operates as a cryptocurrency prime dealer and trading platform catering to institutional investors, hedge funds, and businesses based in San Francisco.
Bitcoin is already facing pressure with the Dollar Index (DXY) rising. As of now, BTC is down 2% over the past 24 hours, trading at $75,670, while the DXY remains above 99, looking to build on Wednesday’s 0.5% gain.
The reason higher bond yields typically affect Bitcoin and other risk assets lies in their nature. U.S. government bonds are issued for borrowing needs, with yields representing the annual return for investors. When yields increase, bonds become more attractive due to their low-risk profile. A 30-year Treasury yielding 5% offers nearly a risk-free return.
Consequently, each dollar invested in Bitcoin represents a missed opportunity to earn that 5% yield, typically resulting in capital moving out of non-yielding risk assets like Bitcoin and other high-risk investments such as technology stocks. Rising yields also tend to negatively impact gold prices, which fell over 1% to a one-month low of $4,540 on Wednesday before trading near $4,564.
“Historically, rising Treasury yields and a stronger dollar have pressured crypto valuations by tightening financial conditions,” noted Vikram Subburaj, CEO of the FIU-registered Giottus exchange in India.
It’s not just the 30-year yield that is increasing; the 10-year yield, which serves as an economic benchmark for borrowing costs, is also elevated. Together, they indicate financial tightening, making borrowing more expensive and discouraging risk-taking across financial markets and the economy.
Bond yields are rising globally, including in the U.K. and other regions.
Although the central bank maintained interest rates between 3.5% and 3.75%, as expected, internal dissent caught markets by surprise. Three out of twelve voting officials opposed the easing language in the statement, pushing up expectations for prolonged high interest rates reflected in rising bond yields.
“The Fed’s decision to hold rates steady wasn’t surprising, but the three dissenters against easing guidance sent a strong hawkish signal, impacting Bitcoin as it often correlates with risk,” said Matt Mena, senior crypto research strategist at 21shares, via email.
ING described this hawkish dissent from three officials as a cautionary message to incoming Fed Chair Kevin Warsh, suggesting they are not easily swayed by his perspective that rates can eventually be reduced. “They perhaps want to make it clear that they will not be easily swayed to his way of thinking that rates in time can be lowered,” ING analysts noted.
Interestingly, the policy statement issued Wednesday lacked any explicit easing bias, reinforcing that the Fed is not rushing to shift its stance.
The bond yield increase isn’t solely about the Fed. Early Thursday, oil prices surged to levels last seen in 2022, with Brent briefly exceeding $125 per barrel following President Trump’s consideration of extending the Iranian port blockade. Oil prices have remained elevated, typically ranging between $80 and $120 since the Iran conflict began in late February.
Consequently, rising energy prices at gas stations are increasing long-term inflation expectations, as noted by CoinDesk earlier this week. These factors collectively contribute to higher yields.
“Inflation hasn’t convincingly returned to target levels, and the Fed isn’t signaling a near-term change. While markets seek clarity on rate cuts, the Fed remains silent. Until that changes, capital will continue to favor yield and safety over volatility in crypto, maintaining a challenging macro environment,” Pires concluded.