The yield on the 30-year US Treasury has surpassed 5.14%, indicating a significant shift in the fixed-income market, as highlighted by Shang Wu, a senior analyst at BitMEX. Rising government bond yields are causing concern among investors, who are witnessing a "panic" in the traditionally stable realm of government securities.
According to Wu, the current situation suggests an impending "structural" change that may lead to a Bitcoin "supercycle," as investors seek refuge in assets less susceptible to inflation. Yields on the Bank of Japan’s 10-year government bonds have also reached 2.8%, underscoring a broader trend that could force governments to confront the dilemma of either currency debasement or potential debt collapse.
The US national debt, now exceeding $39 trillion, complicates the landscape as growing geopolitical tensions and rising energy prices threaten to escalate government spending. Wu emphasized that higher interest rates, while intended to curb inflation, could exacerbate the government's debt servicing costs, making traditional economic controls ineffective.