Treasury Yields Surge, Bitcoin Falters
Bitcoin’s price dropped below $84,000 on Thursday, tracking a broader sell-off across risk assets as U.S. Treasury yields soared to levels unseen in nearly two decades.
The 10-year U.S. Treasury yield surged past 5.1%, its highest mark since 2007, while the 30-year yield hit 5.419%, a threshold not seen since 2004. In a sign of deepening volatility, the MOVE index—which tracks expected swings in the U.S. bond market—jumped by 21% to above 95, marking its most elevated reading since April. With government borrowing costs rising so sharply, investors appeared to rotate out of both equities and digital assets.
The mood was risk-off across global markets.
Initial jobless claims last week came in at 197,000, just 1,000 higher than the previous reading.
Risk-Off Mood Hits S&P, Nasdaq
The pressure on crypto was mirrored in traditional markets: S&P 500 futures lost 0.61% while Nasdaq 100 futures tumbled by more than 1%. The impact rippled through other asset classes as well—gold prices fell by 0.71% to $4,257 and Brent crude oil rebounded over 4% to nearly $104 per barrel after a six-session decline. Even major tech names weren’t spared; Oracle shares dropped by over 4% following news of a force majeure notice tied to its Project Jupiter data center development.
This broad-based retreat highlights the tension between surging yields and investor appetite for risk: even as some economic data remains resilient—such as jobless claims coming in at just 197,000 last week—the cost of capital is rising fast enough to overshadow pockets of strength elsewhere.
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Fed Hike Expectations Rattle Investors
Traders are now pricing in four additional Federal Reserve rate hikes by June 2027, according to CME FedWatch data cited by coindesk.com. The expected federal funds target has shifted higher, with markets now forecasting a range of 4.75% to 5% for mid-2027 compared to the current range of 3.75% to 4%. The Fed’s most recent move—a quarter-point increase just this month—has only added fuel to expectations that rates will remain elevated for years rather than months.
As yields climb along the entire curve—the 20-year Treasury is approaching an eye-watering 5.5%—the long-bond ETF (TLT) has plummeted to all-time lows below $80. This persistent upward march in rates is putting sustained pressure on growth assets like Bitcoin and technology stocks alike.
Dollar Strength Weighs on Crypto Markets
Another headwind for Bitcoin has been renewed dollar strength: the dollar index (DXY) rose by another 0.13% to reach 101.24, its highest reading since July. A stronger dollar typically makes dollar-denominated assets less attractive for international investors and can sap demand for both gold and cryptocurrencies.
Meanwhile, altcoins have fared even worse than Bitcoin itself over the past day: Ether and Solana are down closer to 3%, XRP slid by more than 7%, and Dogecoin shed roughly 8%, now hovering just above nine cents. Only TRX managed to hold flat amid the turbulence.
Why it matters: Practical Impact
For investors tracking digital assets closely, this episode underscores how macroeconomic forces can override crypto-specific narratives—even when Bitcoin still holds its place as the world’s largest cryptocurrency by market cap and trades far above its pre-2025 levels. The current price of $83,523 represents an almost flat performance over the last month (+0.05%) and week (+0.09%), despite having set an all-time high of $126,080 less than a year ago in October 2025.
Yet this headline number hides a more complicated reality: while Bitcoin remains well ahead of most traditional assets on a multi-year basis, its near-term correlation with bonds and equities has tightened significantly during periods of rapid rate repricing. Investors hoping for digital assets to act as an uncorrelated hedge may need to recalibrate those expectations when monetary policy shifts dominate market psychology.
It’s also unclear whether crypto markets will find relief soon; with Treasury auctions clearing at their highest yields since before the financial crisis—such as Wednesday’s five-year note sale at over 5%—the cost of waiting out volatility is rising for all but the most patient holders.
What the market will watch
If the 10-year U.S. Treasury yield, which closed at 5.11% on Wednesday and reached 5.116%—its highest since 2007—continues to climb above this threshold, traders will immediately monitor for further downside in bitcoin, which has already dropped below $83,000 as yields surged.