Bitcoin Plunges Below $84K Amid Spike in Treasury Yields

Bitcoin's price plummeted below $84,000 on Thursday, following a decline of over 2% in the wake of rising Treasury yields. The 10-year Treasury yield reached its highest level since 2007, marking a significant milestone at 5.11%. This surge in borrowing costs had a ripple effect across the cryptocurrency market, with Dogecoin experiencing the most severe losses among top cryptocurrencies, dropping approximately 8%.

The selloff was further exacerbated by weak demand at a $70 billion five-year Treasury auction, which intensified market pressures. Additionally, crude oil prices surged more than 4%, fueling inflation and interest rate anxieties. Mauricio Di Bartolomeo, Ledn co-founder, noted substantial call option positioning at the $85,000 strike price in advance of Friday's approximately $14 billion options expiration on Deribit.

The Treasury Department auctioned $70 billion worth of five-year notes during afternoon trading, which settled at 5.033%, marking the highest auction yield since 2006. This development indicated diminishing willingness to hold government securities at prevailing interest rates, elevating yields and diminishing the attractiveness of non-yielding assets such as Bitcoin.