Weekly Wrap: Rising Treasury Yields Sink Bitcoin

Bitcoin (CRYPTO: $BTC) is on track for a losing week as rising Treasury yields continue to pressure risk assets such as stocks and crypto. In late trading on Oct. 9, Bitcoin's price was at $82,250 U.S., down nearly 5% over the past week. Digital assets have been under pressure as yields on U.S. government bonds steadily rise.

The yield on the benchmark 10-year U.S. Treasury has risen by 5.25% from 4.79% since Sept. 1. That's a big move in Treasury yields in a little over a month. At 5.25%, the yield on the 10-year Treasury is now at its highest level since April 2002. Higher yields offered by bonds attract investors, leading them to rotate capital out of riskier assets such as crypto.

So far in October, Bitcoin is down 1.50%, a sharp reversal from the 42% gain achieved in this year's third quarter. The decline to begin October is atypical for digital assets. October is usually the best month of the year for Bitcoin, producing an average increase of 18%. October has often been so strong for crypto that investors call the month "Uptober." But that does not appear to be the case so far this month.

Here's what else happened in the crypto sector over the past week…

Outflows From Bitcoin ETFs Surge: The continued rise of U.S. Treasury yields is leading to an exodus of investor capital from Bitcoin exchange-traded funds (ETFs). On Oct. 7, about a dozen U.S. spot ETFs saw net outflows of $487.1 million U.S., the most since June 25 of this year, according to data from SoSoValue. After seeing $2.65 billion U.S. of net inflows in September, capital has again begun to leave the Bitcoin funds. So far in October, the ETFs are down $165 million U.S.