The selloff in cryptocurrency markets is accelerating as government bond yields around the world rise, pressuring risk assets such as stocks and digital tokens.
Stay Ahead of the Market:
- Discover outperforming stocks and invest smarter with Top Smart Score Stocks
- Filter, analyze, and streamline your search for investment opportunities using Tipranks' Stock Screener
The benchmark U.S. 10-year Treasury yield has risen to 4.70%, a multi-year high and up more than 100-basis points since the U.S. Federal Reserve began lowering interest rates last September. The current situation has been compounded by action in the United Kingdom, where the 30-year Gilt yield has risen to 5.35%, its highest level since 1998.
The yield on the Gilt is now up 105-basis points since the Fed’s first rate cut. Bond yields are also spiking in Germany and Italy. In Japan, the country’s benchmark 10-year bond yield is now at its highest level in nearly 15 years.
Risk Assets Fall
The rising bond yields are pressuring riskier assets such as crypto, with Bitcoin’s (BTC) price down more than 10% from its record high above $100,000 set in recent weeks. Several other cryptocurrencies are also seeing their prices fall, with Ethereum (ETH), Solana (SOL), and Cardano (ADA) each down about 10% over the past week.
Bond yields are rising on fears of renewed inflation and trade wars under the administration of incoming U.S. president-elect Donald Trump. In recent days, Trump has doubled down on his threats to impose tariffs of 25% or higher, seize control of Greenland using military force, and take back the Panama Canal.
Is BTC a Buy?
Most Wall Street firms don’t offer ratings or price targets on Bitcoin, so we’ll look at the cryptocurrency’s three-month performance instead. As one can see in the chart below, the price of BTC has risen 55% in the last 12 weeks.
