Bitcoin (BTC) Enters 'Up Only Mode' as US Bond Market Crisis Drives Investors to Seek Alternative Stores of Value

Bitcoin (BTC) is entering what former BitMEX CEO Arthur Hayes calls “up only mode,” as a deepening crisis in the US bond market potentially drives

As the US 10-year Treasury yield climbed above 4.59% on April 11, reaching its highest level in two months, and the $29 trillion US Treasury market posted a decline of more than 2% this week — marking its steepest drop since September 2019, the crypto market saw investors rotating out of traditional markets.

Investors are pulling out of traditional markets amid a deepening crisis in the US bond market, potentially driving them toward alternative stores of value like Bitcoin (BTC).

What happened: The benchmark 10-year Treasury yield surged above 4.59% on April 11, reaching its highest point in two months. Meanwhile, the $29 trillion US Treasury market is en-route to its worst weekly performance, with a decline of more than 2% this week.

This marks the steepest decrease since September 2019, when a liquidity crunch in the repo market necessitated intervention from the Federal Reserve.

Also Read: Despite rumors, Donald Trump has no plans to run for president again in 2024

Furthermore, US President Donald Trump’s unpredictable tariff announcements and subsequent reversals are adding to the ongoing chaos. After threatening to impose significant tariffs on global trading partners, Trump quickly cancelled many of the measures for specific countries, with the exception of China.

In another development, the greenback is continuing its downward spiral, with the US Dollar Index (DXY) dropping below the 100 mark for the first time since 2022 to notch its worst weekly performance in over two years.

On the other hand, Bitcoin experienced a gain of over 4.50% amid the US bond market rout, reaching levels around $83,250.

This optimism stems from the belief that the deteriorating macroeconomic conditions will prompt US policymakers to take action, and traders are now pricing in at least three rate cuts from the Federal Reserve by year-end, with a fourth becoming increasingly likely.

It is no secret that rate cuts have historically been bullish for Bitcoin.

Is Bitcoin going ‘up only’?

“It’s on like donkey kong,” wrote former BitMEX CEO Arthur Hayes in his April 11 X post.

As the US 10-year Treasury yield climbs above 4.59% on April 11, reaching its highest point in two months, and the $29 trillion US Treasury market posts a decline of more than 2% this week — marking its steepest decrease since September 2019, crypto investors are discussing the potential implications for Bitcoin (BTC).

Investors are pulling out of traditional markets amid a deepening crisis in the US bond market, which could drive them toward alternative stores of value.

What happened: The benchmark 10-year Treasury yield surged above 4.59% on April 11, reaching its highest point in two months.

Also Read: Unemployment claims rise as bulk of impact from March jobs report to come

Also, the $29 trillion US Treasury market is en-route to its worst weekly performance, with a decline of more than 2% this week. This marks the steepest decrease since September 2019, when a liquidity crunch in the repo market necessitated intervention from the Federal Reserve.

The stellar performance of the US economy in the first quarter, which saw the largest increase in more than two years, is exacerbating concerns about a potential economic slowdown later this year.

However, the bulk of the impact from March’s stellar jobs report, which saw the addition of 236,000 jobs and an unemployment rate of 3.8%, is still to be realized. Economists are now targeting an increase in claims to 240,000.

Furthermore, US President Donald Trump’s unpredictable tariff announcements and subsequent reversals are adding to the ongoing chaos. After threatening to impose significant tariffs on global trading partners, Trump quickly cancelled many of the measures for specific countries, with the exception of China.

In another development, the greenback is continuing its downward spiral, with the US Dollar Index (DXY) dropping below the 100 mark for the first time since 2022 to notch its worst weekly performance in over two years.

In contrast, Bitcoin experienced a gain of over 4.50% amid the US bond market rout, reaching levels around $83,250 on April 11. This optimism stems from the belief that the weakening macroeconomic conditions will prompt US policymakers to act.

Furthermore, bond traders are now pricing in at least three rate cuts from the Federal Reserve by the end of the year, with a fourth becoming increasingly likely.

Target rate probabilities for December Fed meeting. Source: CME

Rate cuts have historically been bullish for Bitcoin.

See More: Bitcoin price analysis: BTC/USD set for a rally towards $10