Bitcoin is a non-yielding asset. When Treasury yields fall and real rates compress, the opportunity cost of holding Bitcoin drops. Investors rotate from bonds into riskier assets to find returns—a shift that benefits crypto.
A flat yield curve signals economic weakness and risk-off sentiment—typically bearish for crypto. A steep curve signals growth expectations and risk-on—bullish for Bitcoin.
On September 18, 2026, the Fed is expected to announce its first interest-rate cut in years. Rate cuts lower yields across the curve, which could trigger another crypto rally—or disappoint if the cut is smaller than expected.
As of August 27, the 10-year yield was around 4.647%. Watch it closely: if it rises above 4.8%, expect crypto headwinds. If it falls below 4.5%, expect strength. The correlation has held through 2026.
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