Bitcoin rebounded approximately 3% from a low below $80,000 on Thursday as the 10-year Treasury yield fell 13 basis points to 5.06%. The cryptocurrency recovered to above $82,000 by noon New York time, according to CoinGecko data, as traders assess whether declining yields supported the price recovery or both assets moved coincidentally.
Bitcoin touched a 24-hour low of $79,806 on Thursday morning, hours after yields began falling. The rebound occurred ahead of a scheduled Treasury bond buyback operation, which the government describes as a liquidity support program.
Tracking Yield and Asset Movements
The 10-year yield's 13 basis-point decline came after the Producer Price Index rose 1.3% in September, marking the largest monthly gain since March 2022. Technology stocks fell sharply during the period, with US chip stocks losing $1.64 trillion over six trading sessions as investors shifted toward bonds for safety.
The relationship between yields and Bitcoin appeared evident on Wednesday, when the 10-year yield climbed to 5.33% following the September inflation report. Bitcoin fell approximately 2% by mid-afternoon that day.
Treasury Buyback Operations
The Treasury announced on August 19 that it would at least double its long-bond buyback size. Yields fell that day and Bitcoin's price rose about 7%.
Recent buyback operations have shown mixed timing relative to Bitcoin's movements. Six hours after the September 10 operation, Bitcoin was 1% lower. However, it was 0.4% higher following the September 24 buyback and 1.3% higher after the October 8 operation. Thursday's buyback accepted $6 billion after Bitcoin had already recovered.
Treasury typically conducts each operation between 1:40 and 2:00 p.m. Eastern Time. Upcoming tests of the relationship include the October 27 buyback and Treasury's refunding schedule on November 4.
