Dogecoin Slides 8% as Bitcoin Falls Below $84K Amid Rising Treasury Yields

A rise in oil prices, the strongest U.S. business activity reading in more than five years and weak demand at a five-year Treasury auction combined to push borrowing costs higher, weighing on cryptocurrencies with DOGE suffering the sharpest decline.

Bitcoin was trading around $83,900 during Thursday morning Asian hours, down more than 2% over the previous 24 hours after briefly approaching $87,300, according to CoinDesk data. The 10-year U.S. Treasury yield ended Wednesday at 5.11%, marking a 15-basis-point increase in a single day, Treasury data showed.

Dogecoin bore the brunt of the crypto sell-off, dropping 7% to slightly above $0.09. Zcash, XRP and HYPE each declined between 5% and 6%, while Ether, Solana and BNB slipped between 2% and 3%. TRX was little changed.

Oil prices were the first major catalyst, with Brent crude gaining more than 4% to approach $104 per barrel. The move ended a six-day losing streak that had previously helped ease concerns over inflation.

Markets then reacted to S&P Global’s flash survey of U.S. businesses, which showed economic output expanding at its fastest pace in more than five years. The composite index climbed to 58.4, its highest reading since July 2021.

Later Wednesday, the Treasury Department’s $70 billion five-year note auction also added pressure to bond markets. The securities were sold at a 5.033% yield, the highest auction level since 2006 and roughly 3 basis points above their pre-auction trading level. The premium indicated that investors required additional yield to purchase the debt.

Higher Yields Pressure Risk Assets

Rising government bond yields increase the opportunity cost of holding non-yielding assets such as bitcoin while also raising borrowing expenses for traders using leverage. Bitcoin recorded its sharpest decline on Wednesday shortly after the U.S. business survey was released.

Bitcoin is now trading below $85,000, a key strike level where Ledn co-founder Mauricio Di Bartolomeo identified a sizable concentration of call options ahead of Friday’s approximately $14 billion Deribit expiry.