Bitcoin’s Post-CPI Upside at Risk Amid Highest U.S. Treasury Market Volatility in Four Months.

Bitcoin’s Recovery May Be Delayed as Treasury Market Volatility Surges

Rising volatility in the U.S. Treasury market could act as a headwind for Bitcoin’s (BTC) price rebound, despite signs of easing inflation.

February’s lower-than-expected inflation report has strengthened expectations for Federal Reserve rate cuts, leading analysts to project BTC could soon surpass $90,000, up from its current $82,000.

“Bitcoin appears ready for its next breakout beyond $90K, given cooling inflation and steady macro conditions,” said Matt Mena, Crypto Research Strategist at 21Shares.

However, the rally may take longer to materialize due to increasing volatility in Treasuries. The Merrill Lynch Option Volatility Estimate Index (MOVE), which measures expected 30-day volatility in U.S. Treasuries, has surged to 115, its highest level since Nov. 6, reflecting a 38% jump in three weeks, according to TradingView.

Because U.S. Treasuries serve as a foundation for global markets, heightened volatility often reduces liquidity and leverage, causing investors to take a more risk-averse approach.

Following the Nov. 4 election, the MOVE index declined, easing financial conditions and supporting Bitcoin’s rise from $70,000 to $108,000. However, as Treasury volatility stabilized in December and January, BTC’s momentum also faded.

If this market instability persists, Bitcoin’s recovery could be slower than anticipated.

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