In simple terms, U.S. Treasuries are the 'IOUs' issued by the U.S. Previously, the world rushed to buy them because of stable interest rates and good credit. Now it's different — recently, the U.S. auctioned off 20-year Treasuries, and the winning bid rate soared to 5% (compared to 4% last year), indicating that there are fewer buyers, forcing the U.S. to offer higher interest rates to sell them.
This has two implications for Bitcoin:
Short-term bearish: As U.S. Treasury interest rates rise, some funds will be pulled from high-risk assets like Bitcoin to chase 'high-interest IOUs,' leading to a drop in crypto prices (for example, when U.S. Treasury rates spiked in May, Bitcoin plummeted 8% that day).
Long-term nuclear explosion: If U.S. Treasuries can’t be sold at all (for instance, if rates break 6%), it indicates a loss of confidence in the U.S. dollar globally. At this point, Bitcoin's 'digital gold' property will explode — with a maximum of 21 million coins that will never be exceeded, it's a thousand times more reliable than the crazily printed U.S. dollar!
For example 🌰:
Japan's government bonds collapsed last year, and when rates soared to 3.1%, Bitcoin surged 15% in just one week, as Japanese people frantically exchanged yen for BTC to hedge against risks.
Conclusion:
The worse U.S. Treasuries perform, the more attractive Bitcoin becomes!
The total size of U.S. Treasuries is now $36 trillion, and just the interest alone needs to be paid back $950 billion a year; this Ponzi scheme will collapse sooner or later.
On the day of the Treasury collapse, Bitcoin will take off!
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