Bitcoin blinks less than gold when Treasury yields move

Bitcoin $BTC$79,394.02 may be a better hard asset than gold, according to a correlation study.

Both have been rising recently, just as concerns about the fiscal health of advanced-economy governments have come to dominate market sentiment, pushing bond yields, or market-implied borrowing costs, higher.

As of today, the 90-day correlation coefficient between $BTC and gold’s daily returns stands at 0.59, according to data from TradingView and CoinDesk. That’s the highest since 2020, when central banks and governments were printing truckloads of money to cushion the economy and markets during the pandemic.

While both are viewed as hard assets that stand to benefit from fiscal worries and the prospect of financial repression, bitcoin seems to have a slight edge.

The reason lies in its relationship with the U.S. 10-year Treasury yield, the benchmark borrowing cost that influences credit conditions across the economy (check Today’s Signal). An increasing bond yield is typically seen as a headwind for assets like gold and bitcoin, which just sit in investors’ portfolios without generating any new cash.

Bitcoin’s correlation with the 10-year yield is negligibly negative, and notably weaker than gold’s.