U.S. Treasury yields surge to a two-decade high, putting pressure on the crypto market, but institutional funds flow in against the trend
I. A macro storm is on the way
U.S. financial markets are going through a sharp bout of turbulence. The yield on the 10-year U.S. Treasury note jumped to 5.15%, the highest level since 2007. Behind this move are multiple factors working together: robust PMI economic data, weak demand in Treasury auctions, and hawkish signals from the Federal Reserve. Market expectations for a 25-basis-point rate hike in October have risen to 70%.
This macro backdrop puts immense pressure on the entire risk-asset market. Bitcoin has pulled back from a high of $87,000 to below $84,000, and crypto-related stocks have generally declined as well. Risk-off sentiment in traditional financial markets is spreading into crypto.
II. Institutional funds positioning counter to the trend
However, beneath the surface of price pullbacks, institutional investors’ behavior tells a very different story. U.S. spot Bitcoin ETFs recorded net inflows for five straight trading days, with a cumulative amount of $2.3 billion. BlackRock’s IBIT and Fidelity’s FBTC lead the inflows. Even more noteworthy, year-to-date net ETF inflows turned positive again for the first time since April, indicating that even under macro headwinds, institutional demand for long-term Bitcoin allocation remains strong.
The coexistence of falling prices and inflowing capital reflects that the market is undergoing a healthy reshuffling of holdings. Short-term speculative funds are stepping aside as yields rise and pressure increases, while long-term allocation funds are buying the dip.
III. Tokenized assets accelerate
Against the larger trend of convergence between traditional finance and crypto, tokenized real-world assets are developing at an accelerating pace. ONDO Finance, in partnership with BlackRock, launched three tokenized investment portfolios based on BlackRock strategies, open to eligible non-U.S. investors. These portfolios are presented in the form of a single transferable token, significantly lowering the barrier for institutions to participate in on-chain finance.
Meanwhile, tokenized U.S. stocks on Binance’s Web3 platform are also expanding continuously. To date, multiple tokenized stocks—including EEM, MRNA, LIN, and others—are already trading on-chain. These tokenized assets allow global investors to participate in the U.S. stock market 24/7, breaking the limitations of traditional trading hours.
IV. Regulatory framework gradually becomes clearer
Mike Selig, Chair of the U.S. Commodity Futures Trading Commission (CFTC), announced that after the Senate failed to pass the CLARITY Act, the agency will use existing statutory authority to set rules for crypto market structure. This statement marks a new phase in U.S. crypto regulation: no longer relying on congressional legislation, but building the rule framework through proactive actions by administrative agencies.
The proposed rules would cover around-the-clock algorithmic on-chain markets and leveraged crypto trading venues, providing the industry with clearer compliance guidance. While the specific details of regulation remain to be seen, this proactive stance in itself is a positive signal that helps reduce market uncertainty.
V. Stablecoin strategy upgrade
Another development worth noting is that the U.S. government is considering promoting the global application of dollar stablecoins. The plan involves the Treasury Department and the State Department and aims to reinforce the position of the dollar as a global reserve currency by promoting USD-backed stablecoins.
If implemented, the adoption rates of dollar stablecoins such as USDC and USDT in emerging markets and cross-border payments would rise significantly. This would not only bring a large liquidity increment to the crypto market, but also further strengthen the dominance of the dollar in the global financial system.
VI. Market outlook
The current market is at a critical turning point. In the short term, rising Treasury yields and stronger rate-hike expectations will continue to weigh on risk assets, and Bitcoin and other crypto assets may face further volatility. But in the long run, sustained institutional fund inflows, rapid growth of tokenized assets, and gradually clearer regulatory frameworks are laying the groundwork for the maturation of the crypto market.
For investors, the current environment is both a challenge and an opportunity. In periods of high macro uncertainty, maintaining prudent risk management is essential, but it is also important to look for structural growth opportunities that emerge in adversity.
#FedOctoberRateHikeOddsRiseTo69.7% #BinanceWillListHyperliquid(HYPE) #TokenizedStocks
I. A macro storm is on the way
U.S. financial markets are going through a sharp bout of turbulence. The yield on the 10-year U.S. Treasury note jumped to 5.15%, the highest level since 2007. Behind this move are multiple factors working together: robust PMI economic data, weak demand in Treasury auctions, and hawkish signals from the Federal Reserve. Market expectations for a 25-basis-point rate hike in October have risen to 70%.
This macro backdrop puts immense pressure on the entire risk-asset market. Bitcoin has pulled back from a high of $87,000 to below $84,000, and crypto-related stocks have generally declined as well. Risk-off sentiment in traditional financial markets is spreading into crypto.
II. Institutional funds positioning counter to the trend
However, beneath the surface of price pullbacks, institutional investors’ behavior tells a very different story. U.S. spot Bitcoin ETFs recorded net inflows for five straight trading days, with a cumulative amount of $2.3 billion. BlackRock’s IBIT and Fidelity’s FBTC lead the inflows. Even more noteworthy, year-to-date net ETF inflows turned positive again for the first time since April, indicating that even under macro headwinds, institutional demand for long-term Bitcoin allocation remains strong.
The coexistence of falling prices and inflowing capital reflects that the market is undergoing a healthy reshuffling of holdings. Short-term speculative funds are stepping aside as yields rise and pressure increases, while long-term allocation funds are buying the dip.
III. Tokenized assets accelerate
Against the larger trend of convergence between traditional finance and crypto, tokenized real-world assets are developing at an accelerating pace. ONDO Finance, in partnership with BlackRock, launched three tokenized investment portfolios based on BlackRock strategies, open to eligible non-U.S. investors. These portfolios are presented in the form of a single transferable token, significantly lowering the barrier for institutions to participate in on-chain finance.
Meanwhile, tokenized U.S. stocks on Binance’s Web3 platform are also expanding continuously. To date, multiple tokenized stocks—including EEM, MRNA, LIN, and others—are already trading on-chain. These tokenized assets allow global investors to participate in the U.S. stock market 24/7, breaking the limitations of traditional trading hours.
IV. Regulatory framework gradually becomes clearer
Mike Selig, Chair of the U.S. Commodity Futures Trading Commission (CFTC), announced that after the Senate failed to pass the CLARITY Act, the agency will use existing statutory authority to set rules for crypto market structure. This statement marks a new phase in U.S. crypto regulation: no longer relying on congressional legislation, but building the rule framework through proactive actions by administrative agencies.
The proposed rules would cover around-the-clock algorithmic on-chain markets and leveraged crypto trading venues, providing the industry with clearer compliance guidance. While the specific details of regulation remain to be seen, this proactive stance in itself is a positive signal that helps reduce market uncertainty.
V. Stablecoin strategy upgrade
Another development worth noting is that the U.S. government is considering promoting the global application of dollar stablecoins. The plan involves the Treasury Department and the State Department and aims to reinforce the position of the dollar as a global reserve currency by promoting USD-backed stablecoins.
If implemented, the adoption rates of dollar stablecoins such as USDC and USDT in emerging markets and cross-border payments would rise significantly. This would not only bring a large liquidity increment to the crypto market, but also further strengthen the dominance of the dollar in the global financial system.
VI. Market outlook
The current market is at a critical turning point. In the short term, rising Treasury yields and stronger rate-hike expectations will continue to weigh on risk assets, and Bitcoin and other crypto assets may face further volatility. But in the long run, sustained institutional fund inflows, rapid growth of tokenized assets, and gradually clearer regulatory frameworks are laying the groundwork for the maturation of the crypto market.
For investors, the current environment is both a challenge and an opportunity. In periods of high macro uncertainty, maintaining prudent risk management is essential, but it is also important to look for structural growth opportunities that emerge in adversity.
#FedOctoberRateHikeOddsRiseTo69.7% #BinanceWillListHyperliquid(HYPE) #TokenizedStocks