Binance Research's latest published research report systematically analyzes the evolving relationship between the bond market and the cryptocurrency market, identifies and dissects the impact pathways, assesses the current market conditions, and forecasts potential future trends and their impacts through scenario simulations.
The report points out that the bond market is influencing the cryptocurrency market trends through multiple channels, mainly including risk appetite, liquidity, fluctuations in opportunity costs, and macroeconomic linkage mechanisms. Historical data shows that the correlation between Bitcoin and the U.S. 10-year Treasury yield has stage-specific characteristics (positively correlated from 2021 to 2022, then negatively correlated from 2022 to 2023). Additionally, the expansion of the yield curve (such as the widening of the spread between 10-year and 2-year yields) is usually positively correlated with Bitcoin prices; while the widening of the high-yield bond credit spread (HY OAS) shows a stable negative correlation.
The report also notes that there are multiple structural factors behind the current volatility in the bond market, including uncertainty in tariff policies, sticky inflation, a surge in government debt issuance, and the potential liquidity withdrawal caused by the replenishment of the Treasury General Account (TGA) against the backdrop of low Federal Reserve overnight reverse repo balances.
Finally, the report emphasizes that the direction of the cryptocurrency market may, to some extent, depend on the stability of the bond market and changes in the macro environment. If uncertainty persists, the market may maintain sideways fluctuations; if a 'soft landing' is achieved, it is expected to drive a market rebound; whereas a severe crisis situation could trigger deep sell-offs and deleveraging in the cryptocurrency market.