Bitcoin coin in an empty desert representing weak US Bitcoin demand. Photo by BeInCrypto
Global bond yields have reached levels last seen in July 2008. Bitcoin (BTC) did not exist then. The asset has never traded through borrowing costs this high, and it is not benefiting now.
Gold rose 32% over the past year. Bitcoin fell 46%. Investors who expected a debt squeeze to lift a scarce asset backed the wrong one.
Bitcoin and Gold Price Performance. Source: TradingView
Bond Yields Return to a Level Bitcoin Has Never Seen
A bond yield is what a government pays to borrow. Those costs are now the heaviest in almost two decades.
A Bloomberg gauge of long-dated government debt hit its highest yield since July 2008 in May. It tracks sovereign bonds maturing in 10 years or more.
Bitcoin’s whitepaper appeared that October. The first block followed on January 3, 2009, six months after the peak.
Satoshi Nakamoto stamped that block with a newspaper line.
“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks,” source, genesis block.
Bitcoin was built as an answer to failing government finances. Those finances are strained again. This time the answer is the asset falling.
The move is global, though not uniform. UK 10-year gilts pay 5.05%, the highest of the major markets. Germany sits at 3.21%, a high only since 2011.
Japan pays 2.88% after decades pinned near zero.
Six-panel weekly chart of 10-year government bond yields for the US, UK, Germany, Japan, Australia and France. Source: TradingView
“We’re seeing a broader repricing of duration driven by fiscal realities, persistent inflation risks and some political uncertainty,” Bloomberg reported, citing Barclays strategist Patrick Coffey, who named the driver when the gauge first broke out.
Why Elevated Real Yields Cap Bitcoin
Compare the two eras directly. The US 10-year paid 2.46% on January 2, 2009, per Treasury records. It now pays 4.69%. The long end moved further. The 30-year paid 2.83% in Bitcoin’s…
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