Bitcoin falls below $70,000, but the real driver isn’t crypto—it’s the bond market 📉
The yield on 10-year U.S. Treasuries surged to 5.13%, up more than 13 basis points in a single day and above 5.1% for the first time since January 22. The 2-year yield hit 4.88% and the 30-year reached 5.44%, with yields rising across the board.
Three things lit the fuse: October CPI rose 0.4% overall and 0.3% on a core basis, beating expectations for the third consecutive time; Thursday’s $25 billion 30-year Treasury auction drew a 5.441% yield, with weak demand and a 0.4-basis-point tail; and the U.S. federal budget deficit hit $404 billion in October, a record for the month.
Markets are now pricing in an over 85% chance of a 25-basis-point rate hike in December. As money gets more expensive, risk assets are naturally the first to take a hit—$BTC briefly dipped to $67,600 today, falling below $70,000 for the first time since August 19.
This whale’s take: This isn’t a problem originating in crypto; the macro tide is going out. Until yields turn back down, every dollar spent buying the dip is a bet against the Fed. October’s PPI, due at 9:30 p.m. tonight, is the next test. If it comes in hotter than expected, $70,000 will be tested again.
The yield on 10-year U.S. Treasuries surged to 5.13%, up more than 13 basis points in a single day and above 5.1% for the first time since January 22. The 2-year yield hit 4.88% and the 30-year reached 5.44%, with yields rising across the board.
Three things lit the fuse: October CPI rose 0.4% overall and 0.3% on a core basis, beating expectations for the third consecutive time; Thursday’s $25 billion 30-year Treasury auction drew a 5.441% yield, with weak demand and a 0.4-basis-point tail; and the U.S. federal budget deficit hit $404 billion in October, a record for the month.
Markets are now pricing in an over 85% chance of a 25-basis-point rate hike in December. As money gets more expensive, risk assets are naturally the first to take a hit—$BTC briefly dipped to $67,600 today, falling below $70,000 for the first time since August 19.
This whale’s take: This isn’t a problem originating in crypto; the macro tide is going out. Until yields turn back down, every dollar spent buying the dip is a bet against the Fed. October’s PPI, due at 9:30 p.m. tonight, is the next test. If it comes in hotter than expected, $70,000 will be tested again.
