Bitcoin is having difficulty maintaining its price around 100,000 USD due to rising US Treasury yields and a strengthening dollar. The so-called ‘Trump trade’ is losing momentum as bond yields increase, affecting risk assets like Bitcoin. The cryptocurrency recorded a negative return of 6% in the past month, mirroring stock market performance.

Higher Treasury yields reduce global liquidity, making traditional investment avenues such as bonds more attractive compared to digital assets. The Chief Innovation Officer at Monetae Exchange points out that the negative historical correlation between Bitcoin and US interest rates plays a role here. As bond attractions rise, digital currencies like Bitcoin face financial challenges.

Some in the cryptocurrency community believe that despite current challenges, the long-term prospects for Bitcoin remain positive, particularly if Trump’s presidency continues to offer regulatory support. They argue that the current price dip should not cause alarm, as the potential benefits of a favorable US institutional framework could eventually bolster Bitcoin’s growth.