BTC $82,902 
ETH $2,658 
USDT $0.9997 
BNB $756.53 
XRP $1.48 
USDC $0.9999 
SOL $117.10 
TRX $0.3341 
ZEC $1,373 
FIGR_HELOC $1.00Gold drops 3.4% as bond yields rise, Bitcoin pressured
A sharp gold selloff tied to rising Treasury yields and Fed rate hike bets has pushed Bitcoin lower, raising questions about crypto's macro sensitivity.
Key takeaways
- Gold drop was rare. Gold's 3.4% Sept. 28 fall was nearly 3 standard deviations below its average daily move since 2006.
- Treasury yields hit 2007 high. The 10-year U.S. Treasury yield reached 5.23% on Sept. 28, its highest level since 2007.
- Bitcoin ETF demand held up. U.S. spot Bitcoin ETFs saw $2.39 billion in net inflows the week of Sept. 21 to Sept. 25.
What happened
On September 28, spot gold dropped as much as 4% during the trading session to $4,110.55 per ounce, its lowest point in over seven weeks, before regaining some ground to finish at $4,136.81. U.S. gold futures closed 3.5% lower at $4,168.40. The sharp selloff came as U.S. Treasury yields climbed sharply, with the 10-year yield hitting 5.23% that day, its highest level since 2007, as traders grew more confident the Federal Reserve would raise interest rates again by December. The Fed had already hiked its target range by 25 basis points to 3.75% to 4% on September 16. Other precious metals also declined, with silver falling roughly 4.5%, platinum dropping 2.8% and palladium down 3.6%.
Why it matters
The gold selloff underscored the pressure rising risk-free returns place on assets that do not pay interest, a dynamic that also impacted Bitcoin in the same timeframe. Bitcoin traded near $83,000 on September 29, roughly 5% below its September 21 high of around $87,400, as higher Treasury yields and a stronger U.S. dollar reduced the appeal of non-yielding holdings. While Bitcoin's decline was far less severe than gold's, the move highlighted the cryptocurrency's sensitivity to broader macro trends driven by monetary policy. Inflows into U.S. spot Bitcoin ETFs provided a buffer, with the funds pulling in $2.39 billion in net inflows from September 21 to September 25, including a single-day high of $999 million on September 21.
What is still unclear
- It remains unclear how long U.S. Treasury yields will stay above 5%, a threshold that could determine whether Bitcoin continues to face downward pressure or stabilizes in coming sessions.
Questions readers ask
Why did gold drop 3.4% on Sept. 28?
Gold fell 3.4% on Sept. 28 as U.S. Treasury yields surged to their highest level since 2007, and markets raised expectations for another Federal Reserve rate hike. Higher yields make non-yielding assets like gold less attractive to investors.
Is Bitcoin correlated to gold and Treasury yields?
Bitcoin has shown sensitivity to rising Treasury yields and a stronger U.S. dollar in recent sessions, similar to gold, as both assets do not generate yield for holders. Consistent inflows to U.S. spot Bitcoin ETFs have provided some support for prices recently.
What was the 10-year Treasury yield on Sept. 28?
The 10-year U.S. Treasury yield reached 5.23% on Sept. 28, its highest level since 2007, according to market data.
