Treasury yields at 5% threaten extending Bitcoin’s best quarter since 2017

Key Summary

Bitcoin's 43% gain in the third quarter is its best since 2017, but it faces increasing pressure as Treasury yields surpass 5%, making risk assets less attractive. Delphi Digital notes that Bitcoin has overcome the hurdle, partly due to the "debasement trade" where investors expect government borrowing and currency expansion to erode the dollar's purchasing power. The US economy added 29,000 jobs in September, reducing expectations for another Fed rate hike in October, which may provide relief for Bitcoin. Treasury yields have tripled in size since the US Treasury announced plans to double its long-dated debt buybacks.