TLDR
- Crypto market cap sits near $2.17 trillion as capital keeps draining from the space.
- Analyst Benjamin Cowen expects the U.S. 10-year Treasury yield to reclaim the 5% mark.
- The 30-year Treasury yield hit 5.28% on July 31, its highest level since 2007.
- U.S. crypto funds saw sharp outflows Friday, with BTC losing $265.37 million.
- Stablecoin supply has dropped by $14.27 billion since May 22, and most of it is sitting idle.
Bitcoin is under pressure as investors weigh the effects of rising U.S. Treasury yields. The wider crypto market has struggled to find a floor over the past few weeks.
Total crypto market capitalization now sits near $2.17 trillion. That figure has slipped as capital continues to leave digital assets.
Fragile economic conditions are adding to the strain. Any fresh move from the Federal Reserve could push prices lower across the board.
Yields Point to a Possible Rate Hike
Crypto analyst Benjamin Cowen expects the U.S. 10-year Treasury yield to keep climbing. He sees a strong chance it reclaims the 5% mark soon.
A rising yield often signals worry about inflation and economic stability. Cowen’s forecast comes right after the 30-year bond yield crossed 5.28% on July 31. That is one of its highest levels since 2007.
Cowen posted on social media that rate cuts don’t always lead to lower yields. He pointed to the period between 2024 and 2025 as his example.
In his tweet, Cowen noted that the Fed cut rates from 5.5% to 3.75% during that stretch. He said the 30-year yield is still higher today than when rates stood at 5.5%.
Cowen believes the Federal Open Market Committee cut rates too early. He expects pressure on long-term yields to keep building as a result.
If the yield holds above 5%, Cowen says the Fed may eventually need to raise rates again. That would tighten the flow of money into riskier investments, including crypto.
A rate hike typically makes borrowing more expensive. That tends to push investors toward safer, more stable assets.
Crypto is widely viewed as a risk asset. Tighter monetary policy usually means less capital flowing from the U.S. into digital currencies.
Money Moves Out of Risk Assets
This shift toward safety already showed up last week. U.S.-listed crypto products recorded a sharp rise in outflows on Friday as the 30-year yield climbed to new highs.
Bitcoin and Hyperliquid (HYPE) took the biggest hits. BTC lost $265.37 million and HYPE lost $1.83 million in that stretch.
Ethereum (ETH) and Ripple (XRP) also saw money leave, though the amounts were smaller. ETH funds lost $9.03 million, while XRP funds lost $7.69 million.
A steeper rate hike could stretch the current downturn out longer. That is part of why traders are watching yields closely.
Capital across the wider market has thinned in recent weeks too. Stablecoin supply has fallen from $321.82 billion on May 22.
Roughly $14.27 billion has left the stablecoin market since then. Most of what remains is sitting idle rather than moving into new crypto positions.
That pattern shows investors are holding back from fresh bets on digital assets for now.
The post Bitcoin (BTC) Price: Rising Treasury Yields Raise Fed Rate Hike Concerns appeared first on Blockonomi.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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