Bitcoin posts strongest third quarter since 2017 amid bond sell-off
- Bitcoin just recorded its strongest third quarter since 2017, posting a 43 percent gain during July, August, and September, even as a historic global bond sell-off pushed U.S.
- The bond market slump intensified as long-term treasury exchange-traded funds breached all-time lows dating back to 2002.
- Rising interest rates and plummeting bond values reflect a broader loss of faith in traditional monetary systems rather than standard liquidity trends.
Bitcoin just recorded its strongest third quarter since 2017, posting a 43 percent gain during July, August, and September, even as a historic global bond sell-off pushed U.S. Treasury yields to a 24-year high. While summer months typically mark a seasonal downtime for the cryptocurrency, the large upward price move arrived early in August, preempting the traditional four-year market cycle.
During the exact same quarter that the cryptocurrency climbed 43 percent, long-term U.S. treasuries suffered a 7.7 percent loss. Such a drop is a massive decline for an asset class traditionally considered risk-free.
Bitcoin Rallies as Treasury Funds Hit Record Lows
The bond market slump intensified as long-term treasury exchange-traded funds breached all-time lows dating back to 2002. The benchmark tracking fund, TLT, smashed through previous trading floors and gapped down further during market sessions.
Traditional financial theory dictates that risk assets like Bitcoin should experience heavy downward pressure when interest rates surge and bond markets contract due to tightening liquidity. Instead, the cryptocurrency rallied against prevailing macroeconomic expectations.
Fiscal Irresponsibility Drives Institutional Hedging
Rising interest rates and plummeting bond values reflect a broader loss of faith in traditional monetary systems rather than standard liquidity trends. Widespread fear of fiscal dominance and monetary irresponsibility is driving the current bond market distress. Rather than acting as a standard risk asset, Bitcoin is attracting capital precisely because investors are fleeing traditional debt instruments. This hedge against systemic monetary irresponsibility explains why the digital asset is performing so strongly while sovereign debt stumbles.