Bitcoin Could Benefit from Rising U.S. Treasury Yields

Rising U.S. Treasury yields, particularly on 10-year notes, typically pose challenges for bitcoin (BTC) and risk assets. However, recent trends suggest a potentially bullish environment for bitcoin:

The consumer price index (CPI) increased by 0.2% month-on-month in April, lower than the expected 0.3%. Year-on-year inflation stands at 2.3%, the lowest since February 2021.
The 10-year Treasury yield reached 4.5%, the highest since April 11, with a notable increase of 30 basis points in May.
The 30-year yield rose to 4.94%, near its highest levels in 18 years.
Despite potential concerns about money rotation from riskier investments to bonds, analysts attribute the yield surge to expectations of ongoing fiscal expansion under President Trump's administration.
Analysts predict that Trump's tax plan could add $2.5 trillion to the fiscal deficit, suggesting a continuation of expansive fiscal policies.
Market focus is shifting towards fiscal expansion as a key driver, which may lead to rising Treasury yields.
Concerns exist regarding the sustainability of U.S. debt issuance, with higher yields increasing debt servicing costs and raising sovereign debt crisis risks.
The Federal Reserve might implement yield curve control to manage rising yields, boosting liquidity and supporting demand for assets like bitcoin.

Overall, the current economic landscape could position bitcoin favorably as an alternative investment amidst rising Treasury yields and expanding fiscal policy.