Markets
Crypto Markets Wobble as Rising Treasury Yields Pressure Risk Assets
BlackRock’s IBIT has surpassed GBTC to become the largest Bitcoin ETF with nearly $20 billion in assets.
Global markets fell on Wednesday as US Treasury yields rose for a second day, dampening risky assets like stocks and crypto.
Bitcoin and Ether fell more than 1%, while Solana consolidated around the $170 level.
Meanwhile, memecoins are cooling down after a hot week. BONK, FLOKI and PEPE recorded losses between 8% and 10%, making them the biggest losers among the top 100 cryptocurrencies by market capitalization.
Rising Treasury yields often reflect expectations of tighter monetary policy from the Federal Reserve. If the market anticipates that the Fed will raise interest rates to combat inflation, this can signal a slowdown in the economy, which is generally negative for risk assets.
Investors are already tempering their expectations of an imminent interest rate cut. THE CME Fedwatch The tool indicates a near certainty that rates will remain unchanged over the summer, with only a 42% chance of a cut in September.
IBIT topples GBTC
BlackRock’s IBIT is now the world’s largest Bitcoin ETF after surpassing Grayscale’s GBTC yesterday. IBIT holds over 288,000 BTC, worth almost $20 billion at current prices.
Bitcoin ETFs saw cumulative inflows of $45 million on Tuesday, with IBIT bringing in $102 million while GBTC lost $105 million in assets.