Bitcoin

Gold

when

Reserve

Key takeaways:
<ul>
 <li>Bitcoin thrives when yields rise on debt and inflation fears, but struggles when central banks tighten aggressively.</li>
 <li>Today’s bond market stress looks inflation- and debt-driven, suggesting BTC could follow gold’s record run with higher-beta gains.</li>
</ul>
Long-term government bond yields are ripping across the US, Europe, Japan and the UK, even as central banks slash policy rates.
The 30-year US Treasury is back near 5%, France’s long bond trades above 4% for the first time since 2011, and UK gilts are testing 27-year highs. Japan’s 30-year yield has reached record levels, prompting analysts to <a href="https://x.com/KobeissiLetter/status/1962905103469556042" rel="noopener noreferrer nofollow" target="_blank">call</a> it the “collapse of global G7 bond markets.”
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990eee-b9de-7e93-adbc-3dbe38f50d13" title="">
 <figcaption style="text-align: center;">Source: The Kobeissi Letter
 </figcaption>
</figure>
But what happens to Bitcoin amid this concerning macroeconomic outlook? Let’s examine.
<h2 id="how-bitcoin-reacted-during-past-yield-spikes">How Bitcoin reacted during past yield spikes</h2>
History shows that Bitcoin’s reaction to rising government bond yields depends on why yields are climbing. Sometimes it rallies like “digital gold,” other times it struggles like a risk asset.
Take the 2013 taper tantrum.
When the Federal Reserve hinted it would slow its money-printing program, the US 10-year yield shot toward 3%. Investors grew anxious about inflation and debt, a sentiment that aligned with Bitcoin’s price explosion from under $100 to over $1,000.
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990efa-514c-7a16-b96f-4a722b045c5a" title="">
 <figcaption style="text-align: center;">US 10-year Treasury yield vs BTC/USD weekly chart. Source: TradingView
 </figcaption>
</figure>
A similar story played out in early 2021.
<a href="https://cointelegraph.com/news/soaring-treasury-yields-are-worrying-economists-but-what-does-this-mean-for-bitcoin" rel="noopener noreferrer nofollow" target="_self">Yields climbed</a> as markets priced in higher inflation during the post-COVID recovery. Bitcoin moved in step with gold, surging to around $65,000 by April.
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990efd-359b-7dec-82e2-9302692b52fc" title="">
 <figcaption style="text-align: center;">US 10-year Treasury yield vs BTC/USD weekly chart. Source: TradingView
 </figcaption>
</figure>
However, in 2018, the outcome was the opposite.
Yields rose above 3% not because of inflation or debt fears, but because the Fed was hiking aggressively. Real returns on bonds looked attractive, and Bitcoin plunged by about 85% during the same period.
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990efe-ab49-73a2-bd7a-6c837b3204f2" title="">
 <figcaption style="text-align: center;">US 10-year Treasury yield vs BTC/USD weekly chart. Source: TradingView
 </figcaption>
</figure>
It shows that Bitcoin behaves like a hedging asset with more upside when <a href="https://cointelegraph.com/news/all-roads-lead-to-inflation-fed-cut-or-not-bitcoin-may-stand-to-gain" rel="noopener noreferrer nofollow" target="_self">yields rise due to inflation</a>, deficits or excess debt supply. Bitcoin usually struggles when yields rise because <a href="https://cointelegraph.com/explained/impact-of-fed-interest-rates-on-crypto-holders" rel="noopener noreferrer nofollow" target="_self">central banks are tightening into growth</a>.
<h2 id="are-rising-bond-yields-bullish-for-bitcoin-this-time">Are rising bond yields bullish for Bitcoin this time?</h2>
Bitcoin has risen by 4.2% in the past three days, moving in lockstep with a surge in long-term Treasury debt in the US and other G7 nations.
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990f1d-c040-7ba3-83d5-cee92aec76c6" title="">
 <figcaption style="text-align: center;">BTC price vs holder retention rate. Source: Glassnode
 </figcaption>
</figure>
At the same time, its holder retention rate is climbing, showing that more traders are choosing to hold onto BTC as a hedge instead of selling.
The backdrop is hard to ignore. US government debt jumped from $36.2 trillion in July to $37.3 trillion by September, up by over $1 trillion in just two months.
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990f0a-9904-7c2d-9590-0c21a4332a1e" title="">
 <figcaption style="text-align: center;">US national debt as of Sept. 3, 2025. Source: USDebtClock.org
 </figcaption>
</figure>
Across the Atlantic, Europe and the UK are facing similar borrowing waves.
The result has been record-sized bond auctions that only clear at higher yields. This is a sign that demand for government bonds is weakening. <a href="https://cointelegraph.com/news/bitcoin-s-hold-of-dollar109k-shaky-as-whales-move-into-eth" rel="noopener noreferrer nofollow" target="_self">UK’s 30-year bond yield</a>, for instance, reached its highest level since 1998 on Wednesday.
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990f0d-8b29-7501-af55-31729b09c0b9" title="">
 <figcaption style="text-align: center;">UK 30-year Treasury yield monthly chart. Source: TradingView
 </figcaption>
</figure>
Gold has already confirmed the shift in investor behavior, away from trusting government bonds and toward hard assets.
The metal’s surge to <a href="https://cointelegraph.com/news/bitcoin-bulls-charge-at-112k-gold-hits-fresh-all-time-highs" rel="noopener noreferrer nofollow" target="_self">record highs above $3,500</a> this week shows that markets are actively hedging against runaway debt and inflation.
<figure><img alt="What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?" src="https://s3.cointelegraph.com/uploads/2025-09/01990f12-337b-7777-a543-a6fed02bbd8a" title="">
 <figcaption style="text-align: center;">XAU/USD monthly price chart. Source: TradingView
 </figcaption>
</figure>
Historically, <a href="https://cointelegraph.com/news/how-high-can-bitcoin-price-go-gold-hits-3-5k-record-high" rel="noopener noreferrer nofollow" target="_self">Bitcoin benefits from such capital rotations</a> a little later than gold. But once it does, it moves faster and further than the precious metal, acting as the higher-beta refuge from monetary and fiscal excess.
Related: <a href="https://cointelegraph.com/news/winklevoss-nakamoto-bitcoin-treasury-euro-funding-euronext-reverse-listing" rel="noopener noreferrer nofollow" target="_self">Winklevoss, Nakamoto-backed Treasury launches with 1,000 BTC</a>
“The central banks are losing control of the long end of the curve,” <a href="https://x.com/1MarkMoss/status/1962925544250487073" rel="noopener noreferrer nofollow" target="_blank">noted</a> Mark Moss, chief of Bitcoin Strategist at UK-based DeFi firm Satsuma Technology, adding:
<blockquote>
 “Looks like YCC (yield curve control) coming to a bond market near you soon. Going long Bitcoin is such an obvious move.”
</blockquote>
Many analysts see <a href="https://cointelegraph.com/news/us-retirement-plans-bitcoin-rally-200k-finance-redefined" rel="noopener noreferrer nofollow" target="_self">Bitcoin reaching a record high of $150,000-200,000</a> by 2026.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

What will Bitcoin price do amid a ‘collapse of global G7 bond markets’?

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