Bitcoin Falls to $83,900 as Treasury Yields Hit 20-Year Highs

Bitcoin declined more than 2% to approximately $83,900 on Thursday Asian morning hours as U.S. Treasury yields surged to two-decade highs, increasing pressure on nonyielding and leveraged assets.

The 10-year U.S. Treasury yield closed Wednesday at 5.11%, up 15 basis points in a single day. The move followed the release of S&P Global’s flash survey showing U.S. business output growing at its fastest pace in more than five years, with the composite index reaching 58.4, its highest level since July 2021. Bitcoin’s steepest drop on Wednesday came shortly after the business survey was released.

Higher yields on government debt raise the bar for holding assets that pay nothing, including bitcoin, and make it more expensive to borrow against leveraged positions. The macroeconomic pressure extended across major cryptocurrencies. Ether, Solana, and Binance Coin each fell 2% to 3%. Zcash, XRP, and Hyperliquid declined 5% to 6%. Dogecoin fell 7% to just above 9 cents, representing an 8% decline stated in market reports.

Bitcoin had traded near $87,300 before the decline began. The pullback to $83,900 reflected the broader market repricing following the yield surge.

Treasury Auction Signals Demand Weakness

The U.S. Treasury’s $70 billion sale of five-year notes cleared Wednesday at 5.033%, the highest auction yield since 2006. The result drew weak demand, clearing 3 basis points above pre-sale trading levels. This weak reception at the five-year maturity contributed to the broader rise in borrowing costs across the Treasury curve.

Brent crude oil climbed 4% to nearly $104 a barrel, ending a six-session slide that had been easing inflation worries. The rebound in energy prices added to the macroeconomic backdrop pressuring risk assets.

Options Expiration Looms

Approximately $14 billion in options are scheduled to expire on Deribit on Friday. Mauricio Di Bartolomeo, co-founder of Ledn, flagged a large block of call options at the $85,000 strike price, signaling potential technical levels as traders manage expiring positions ahead of the deadline.

The combination of rising real rates, weak Treasury demand, and strong economic data has created near-term headwinds for cryptocurrency markets, which benefit from lower borrowing costs and reduced opportunity cost relative to yielding assets.