Treasury yields at 5% threaten extending Bitcoin’s best quarter since 2017 — SkimNews
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- Bitcoin gained 43% in Q3 2024 — its best third quarter since 2017 — and posted a third straight weekly advance, per Delphi Digital's latest weekly newsletter.
- Delphi Digital flagged 5%+ Treasury yields as "real resistance," writing that "when a government bond pays over 5% risk-free, every risky asset has to work harder to deserve the money."
- Bitcoin briefly topped $87,000 last week and has gained more than 35% since mid-August, when the US Treasury announced plans to double long-dated debt buybacks targeting 10- and 20-year notes — buybacks that have since tripled.
- The US economy added just 29,000 jobs in September, well below the 80,000 forecast per the Bureau of Labor Statistics, giving the Fed more room to wait before raising rates again.
- CME Group's FedWatch Tool now puts the odds of an October rate hike at roughly 24%, down from more than 75% a week earlier.
- John Williams, President of the New York Federal Reserve, said the central bank "does not need to rush into another hike" after the September rate increase.
- Vanessa Grellet, managing partner at Arche Capital, argued the debasement trade "doesn't require low interest rates," citing growing investor focus on federal deficits and the government's rising interest bill.
Why it matters: September's 29,000 jobs print (vs. 80,000 expected) collapsed October Fed hike odds from 75%+ to 24% in a week — buying Bitcoin room to extend its 35%+ rally since mid-August. But 5% Treasury yields remain a structural gravity well: risk-free government bonds now directly compete with BTC for capital, and the US Treasury's tripled long-dated debt buybacks show officials working to contain those very same yields.
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