Dollar strength, rising Treasury yields cap Bitcoin upside

On-chain analyst Darkfost said rising U.S. Treasury yields and a stronger dollar are putting downward pressure on Bitcoin prices. Darkfost said the U.S. Dollar Index, or DXY, had risen 5.5% since Sept. 9 to 102.57, the highest level in about 18 months since April 2025. Darkfost added that higher Treasury yields and a stronger dollar are constraining market liquidity and weakening institutional investors’ appetite for risk assets. With Bitcoin still viewed as a relatively high-risk asset, traditional financial markets such as tech stocks and the S&P 500 are absorbing limited liquidity, creating an unfavorable environment for Bitcoin.