Analysis: Rising US Treasury yields diminish Bitcoin's appeal

The rising yields on U.S. Treasurys are increasing the opportunity cost of holding Bitcoin (BTC), CoinDesk reported. The outlet noted that the appeal of BTC and gold is diminishing as investors can now secure higher, risk-free returns from government bonds. Expectations for monetary easing have faded, and the market is now beginning to price in the possibility of further tightening by the Federal Reserve. The two-year Treasury yield has climbed to 4.05%, its highest level in 12 months. Inflation concerns have also resurfaced after both the April Consumer Price Index (CPI) and Producer Price Index (PPI) came in higher than expected. According to the CME FedWatch Tool, the probability of a December rate hike has surged to 44% from 22.5% in just one week. This marks a sharp reversal from expectations at the start of the year for at least two rate cuts by year-end. Meanwhile, BTC is trading sideways around $81,000, below its 200-day moving average of approximately $82,000.