📰 Will US 10-year Treasury yields really be heading for 6%? Thielen: Understand the drivers before you bet on the coin market
Just a couple of days ago, we talked about this. And now, the US 10-year Treasury yield is indeed approaching its historical high near 6%. What does this mean for the cryptocurrency market? Markus Thielen (founder of 10x Research) says the latest takeaway is that understanding the reasons behind the rise in rates matters more than the rate level itself. For Bitcoin, which has no cash flows to support it, the negative drivers from Fed rate hikes are completely different from the negative drivers stemming from fiscal concerns.
Why is this news important?
The 10-year Treasury bond is known as the benchmark for the “risk-free rate.” Its trend acts like a seesaw that affects all risk assets. Currently, the market has two very different expectations:
1. **Fed-driven downside**: If yields rise because the Fed keeps tightening monetary policy, then a zero-coupon asset like Bitcoin could face pressure as safe-haven flows move out.
2. **Risk-premium-driven downside**: If yields rise because the market worries about fiscal deficits, inflation, or a surge in long-term bond risk premium (term premium), then Bitcoin could actually benefit, since it’s seen as a hedge against these macro risks.
Thielen’s core judgment is this: the first scenario is “systemic risk spillover,” while the second scenario is “risk appetite rotation.” The market currently mixes both factors, but the share of the latter may be increasing.
Impact on the market
This means investors can’t simply say “rates rising = Bitcoin falling.” The exact transmission path depends on where the money flows:
- **For BTC**: If Treasury yields rise mainly due to fiscal concerns, capital may rotate from Treasuries into non-standard assets like Bitcoin, supporting the price around $84,288. But once it’s confirmed that the driver is Fed-led tightening, the support level below $82,000 will need to be reassessed. South Korea is one of the most active crypto trading markets globally. Local capital is highly sensitive to these macro drivers—if domestic funds leave, it can directly create sell-pressure on BTC.
- **For ETH**: Ethereum benefits with slightly less sensitivity than BTC, because it still has staking rewards as support. But as long as the driver is Fed rate hikes, all risk assets will face pressure. If the regulatory environment continues to move in a more friendly direction (for example, the EU’s latest proposal to simplify rules), this variable could help ETH perform better than BTC.
Trading idea
💡 If the 10-year Treasury yield truly breaks above 6% and the move is mainly driven by expectations of Fed tightening, then BTC will face clear pressure in the $83,000–$82,500 range, and you may need to reduce exposure to manage risk. If the move is driven by fiscal concerns, there’s still room for a rebound above $85,000. Invalidation condition: If after the Treasury yield breaks 6%, the gold price drops sharply at the same time, it suggests risk appetite has worsened persistently—then this thesis is invalid.
This article has no project sponsorship, and the author does not hold any of the assets mentioned
According to Binance Square
$BTC $ETH #BTC #ETH
⚠️ Not investment advice; predictions are for reference only
Just a couple of days ago, we talked about this. And now, the US 10-year Treasury yield is indeed approaching its historical high near 6%. What does this mean for the cryptocurrency market? Markus Thielen (founder of 10x Research) says the latest takeaway is that understanding the reasons behind the rise in rates matters more than the rate level itself. For Bitcoin, which has no cash flows to support it, the negative drivers from Fed rate hikes are completely different from the negative drivers stemming from fiscal concerns.
Why is this news important?
The 10-year Treasury bond is known as the benchmark for the “risk-free rate.” Its trend acts like a seesaw that affects all risk assets. Currently, the market has two very different expectations:
1. **Fed-driven downside**: If yields rise because the Fed keeps tightening monetary policy, then a zero-coupon asset like Bitcoin could face pressure as safe-haven flows move out.
2. **Risk-premium-driven downside**: If yields rise because the market worries about fiscal deficits, inflation, or a surge in long-term bond risk premium (term premium), then Bitcoin could actually benefit, since it’s seen as a hedge against these macro risks.
Thielen’s core judgment is this: the first scenario is “systemic risk spillover,” while the second scenario is “risk appetite rotation.” The market currently mixes both factors, but the share of the latter may be increasing.
Impact on the market
This means investors can’t simply say “rates rising = Bitcoin falling.” The exact transmission path depends on where the money flows:
- **For BTC**: If Treasury yields rise mainly due to fiscal concerns, capital may rotate from Treasuries into non-standard assets like Bitcoin, supporting the price around $84,288. But once it’s confirmed that the driver is Fed-led tightening, the support level below $82,000 will need to be reassessed. South Korea is one of the most active crypto trading markets globally. Local capital is highly sensitive to these macro drivers—if domestic funds leave, it can directly create sell-pressure on BTC.
- **For ETH**: Ethereum benefits with slightly less sensitivity than BTC, because it still has staking rewards as support. But as long as the driver is Fed rate hikes, all risk assets will face pressure. If the regulatory environment continues to move in a more friendly direction (for example, the EU’s latest proposal to simplify rules), this variable could help ETH perform better than BTC.
Trading idea
💡 If the 10-year Treasury yield truly breaks above 6% and the move is mainly driven by expectations of Fed tightening, then BTC will face clear pressure in the $83,000–$82,500 range, and you may need to reduce exposure to manage risk. If the move is driven by fiscal concerns, there’s still room for a rebound above $85,000. Invalidation condition: If after the Treasury yield breaks 6%, the gold price drops sharply at the same time, it suggests risk appetite has worsened persistently—then this thesis is invalid.
This article has no project sponsorship, and the author does not hold any of the assets mentioned
According to Binance Square
$BTC $ETH #BTC #ETH
⚠️ Not investment advice; predictions are for reference only
