Yields Go Brrr, Crypto Goes 😬: $BTC Slides Under $84K as 10-Year Touches 2007 High

Bitcoin slipped below $84,000 on Thursday as a jump in U.S. Treasury yields to their highest level since 2007 dragged digital assets lower for a second consecutive session. $BTC traded near $83,344, down 1.23% since midnight UTC, after touching nearly $87,300 the prior day, according to CoinDesk data. The U.S. 10-year Treasury yield closed Wednesday at 5.11%, up 15 basis points in a single session, while a $70 billion five-year note sale cleared at 5.033% — the highest auction yield since 2006 and roughly 3 basis points above where the notes had traded before the sale.

Dogecoin bore the brunt of the sell-off, falling about 7% to just above 9 cents. $ZEC, $XRP and $HYPE each lost between 5% and 6%, while $ETH, $SOL and $BNB declined 2% to 3%. $TRX held flat. Brent crude climbed more than 4% to nearly $104 a barrel, ending a six-session slide, while S&P Global's flash U.S. business survey showed output expanding at its fastest pace in more than five years, with the composite index at 58.4, its highest reading since July 2021. Bitcoin's sharpest drop on Wednesday followed the release of that survey.

The dollar index added 0.13% to 101.24, its highest level since July, while gold fell 0.71% to $4,257 and silver dropped 1.18%. S&P 500 futures lost 0.61% and Nasdaq 100 futures slid more than 1%. Rising yields on government debt have lifted the bar for holding nonyielding assets such as bitcoin and made it more expensive to borrow against leveraged positions, a dynamic that CME FedWatch data shows markets now expect to persist: traders are pricing in four quarter-point Fed rate hikes by June 2027, lifting the target range from 3.75%-4% to 4.75%-5%.

Derivatives positioning turned defensive. Shorts made up over 52% of 24-hour taker volume, which rose 10% to $250 billion even as open interest fell nearly 6% to $149 billion, with the pattern pointing to existing positions closing rather than fresh short conviction. Bitcoin futures open interest dropped 6% against a 3% price decline over 24 hours, consistent with genuine long unwinding. On Binance, however, the whale long/short account ratio sits back above 1 at 1.30, a divergence that large holders appear to be watching rather than trading against.

Attention now turns to Friday's roughly $14 billion options expiry on Deribit, with $BTC sitting below the $85,000 strike that Ledn co-founder Mauricio Di Bartolomeo flagged as holding a large block of call options. Yields in the U.S. and abroad continue to climb, with the 20-year Treasury yield approaching 5.5% and borrowing costs rising in France, Germany, the United Kingdom and Japan as the dollar index pushes 3% higher year-to-date above 101.