Bitcoin Dives Below $85K as 5% Treasury Yields Stoke Inflation Fears

Bitcoin plummeted below $85,000 on September 23 after Treasury yields surged above 5% following stronger-than-expected US business activity.

The accelerated growth, as measured by S&P Global's composite PMI, climbed to 58.4 in September, its highest level in over five years.

Chris Williamson, chief business economist at S&P Global Market Intelligence, stated that historical comparisons suggest the survey is consistent with annualized economic growth of about 5%, with roughly 4% growth signaled for the third quarter overall.

The combination of stronger demand and limited capacity gave companies greater pricing power, raising concerns over inflation in the coming months.

As a result, the 10-year Treasury yield moved back above 5% to around levels last seen in 2007, while the two-year yield climbed to its highest level in about 27 months.

James Lavish, Co-Managing Partner of Bitcoin Opportunity Fund, argued that Treasury supply is increasingly colliding with investor concerns over structural dollar debasement.