Bitcoin On The Brink As Trump Tariffs Shatter Bond Market
The bond market is experiencing significant turmoil, with a notable spike in the 30-year US Treasury yield, which increased by 56 basis points in three days, a historic move last seen in 1982. Analysts attribute this to a disorderly liquidation of leveraged positions in the basis trade, a strategy popular among hedge funds. Concerns about liquidity in the US banking system have been raised, alongside fears of a potential crisis if high-yield credit indices rise above 6%. The bond market's dysfunction coincides with a 21% drop in crude oil prices, indicating broader systemic stress. Bitcoin and crypto markets are facing risks due to their growing correlation with equities, with Bitcoin down 8% amid the bond market rout. Calls for Federal Reserve intervention are increasing, with speculation about emergency rate cuts that could benefit Bitcoin. The current financial landscape is marked by fears of inflation and recession exacerbated by new global tariffs.
