Bitcoin Faces Pressure from Rising TIPS Yields
The Bitcoin market is facing significant pressure as the real yield on 30-year U.S. Treasury Inflation-Protected Securities (TIPS) approaches 3%, a level not seen in roughly 17 years, according to TreasuryBonds.com.
This development challenges the narrative that non-yielding assets like Bitcoin are the best hedge in an uncertain world. The real yield on TIPS is now higher than it has been since 2004, making government-backed, inflation-beating returns more attractive to investors.
Analysts say that this move presents a counterweight to Bitcoin's 'digital gold' thesis, as investors can now earn higher inflation-adjusted returns without taking protocol, custody, or price-volatility risk. However, market behavior suggests that the bond-market signal has not yet translated into broad-based de-risking in crypto.
U.S. spot Bitcoin ETFs recorded about $1 billion of net inflows over the past seven trading sessions, indicating renewed 'institutional demand' rather than capitulation. This may reflect a view that the TIPS move is either temporary, already priced in, or less influential than liquidity conditions and risk sentiment in equity markets.