Bitcoin (BTC) Plunges Below $84K as Treasury Yields Spike to 17-Year High

Key Highlights

• Bitcoin declined more than 2%, hovering around $83,900 to $84,150 amid rising Treasury yields.
• Dogecoin suffered the steepest losses among top cryptocurrencies, plummeting approximately 8%.
• The 10-year Treasury yield reached 5.11% at close, marking its peak since 2007.
• Weak demand at a $70 billion five-year Treasury auction intensified market pressures.
• Crude oil prices surged more than 4%, fueling inflation and interest rate anxieties.

Bitcoin experienced significant downward pressure on Thursday. The leading cryptocurrency retreated more than 2%, settling near $83,900 after reaching nearly $87,300 earlier this week.

Bitcoin (BTC) Price

The selloff coincided with U.S. Treasury yields climbing to levels unseen since 2007. The benchmark 10-year yield finished at 5.11%, marking a 15 basis point jump in one trading session.

Dogecoin experienced the most severe downturn among prominent digital assets. The meme-based cryptocurrency plunged roughly 8%, settling just above the 9-cent threshold.

Drivers Behind the Yield Increase

Multiple catalysts converged to drive borrowing costs upward throughout the week. Energy prices emerged as a significant contributing factor.

Brent crude rallied over 4%, approaching $104 per barrel. This reversed a six-day decline that had temporarily alleviated inflation concerns among market participants.

Economic data further intensified the pressure. S&P Global’s preliminary report indicated U.S. economic output expanding at its most rapid rate in more than half a decade.

The composite index climbed to 58.4, representing its strongest reading since July 2021. Bitcoin’s most pronounced decline occurred immediately following this economic release.

During afternoon trading, the Treasury Department auctioned $70 billion worth of five-year notes. The auction encountered tepid demand, settling at 5.033%, marking the highest auction yield since 2006.

Investors demanded additional compensation to absorb the debt. This development indicated diminishing willingness to hold government securities at prevailing interest rates.

Impact Across the Cryptocurrency Sector

Elevated yields diminish the attractiveness of non-yielding assets. Bitcoin and numerous other digital currencies fall within this classification.

ZEC, XRP and HYPE each surrendered between 5% and 6%. Ether, Solana and BNB declined in the 2% to 3% range.

XRP experienced additional losses during later trading hours, falling 7.5% to $1.5052. Cardano retreated 7.1%, while the $TRUMP memecoin tumbled 11.4%.

Bitcoin currently trades beneath the $85,000 threshold. Ledn co-founder Mauricio Di Bartolomeo highlighted substantial call option positioning at that strike price in advance of Friday’s approximately $14 billion options expiration on Deribit.

Increasing Treasury yields extended beyond American borders. Japanese 10-year yields also reached a three-decade peak on Thursday.

Expectations for additional rate increases intensified following the Federal Reserve’s 25 basis point hike last week. The central bank reaffirmed its 2% inflation objective, which market participants interpreted as signaling potential future tightening.

The crude oil rebound stemmed from remarks by Iranian President Masoud Pezeshkian. He spoke at the United Nations General Assembly in New York on Wednesday, delivering critical statements regarding the United States and President Donald Trump.

Notwithstanding Thursday’s decline, bitcoin maintains positive momentum for September. Market participants had responded favorably to enhanced regulatory support from U.S. authorities earlier this month.

The SEC’s decision to authorize a five-year exemption for blockchain-based equity offerings had triggered rallies throughout the altcoin market. This occurred despite the Clarity Act’s failure to advance through Congress.

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