Bitcoin (BTC) is entering what former BitMEX CEO Arthur Hayes calls “up only mode,” as a deepening crisis in the US bond market potentially drives investors away from traditional haven assets and toward alternative stores of value.
Loss of confidence in US policy boosts Bitcoin’s upside prospects
On April 11, the benchmark US 10-year Treasury yield surged above 4.59%—its highest level in two months.
US 10-year Treasury note yields daily performance chart. Source: TradingView
The $29 trillion US Treasury market has dropped more than 2% this week — its steepest decline since September 2019, when a liquidity crunch in the repo market forced the Federal Reserve to intervene.
US President Donald Trump’s unpredictable tariff announcements and reversals have fueled the chaos. After threatening sweeping levies on global trading partners, Trump walked back many of the measures within days for certain countries, except China.
The US dollar added to the pressure, with its strength against a basket of top foreign currencies—as tracked by the US Dollar Index (DXY)—dropping below the 100 mark for the first time since 2022.
US Dollar Index daily performance chart. Source: TradingView
That further notched its worst weekly decline in over two years.
In contrast, Bitcoin rose by over 4.50% amid the US bond market rout, reaching around $83,250 on hopes that the weakening macroeconomic conditions will push US policymakers to act.
“It’s on like donkey kong,” wrote Hayes in his April 11 X post, adding:
“We will be getting more policy response this weekend if this keeps up. We are about to enter UP ONLY mode for $BTC.”
Furthermore, bond traders are now pricing in at least three rate cuts from the Federal Reserve by the end of the year, with a fourth becoming increasingly likely. Rate cuts have historically been bullish for Bitcoin.
Target rate probabilities for December Fed meeting. Source: CME
Bitcoin eyes ‘parabolic bull run’ due to weaker dollar
Historically, sharp drops in the US Dollar Index have preceded delayed but powerful Bitcoin bull runs, according to crypto analyst Venturefounder.
“A falling DXY has typically been a strong bullish signal for Bitcoin,” the analyst wrote on X, pointing to a clear bearish divergence on the chart.
DXY vs BTC/USD monthly price chart. Source: TradingView/Venturefounder
He added that if DXY continues to slide toward the 90 level, it could replicate conditions that led to parabolic BTC rallies during the final stages of previous bull markets — each lasting up to a year.
Additionally, Bollinger Bands creator John Bollinger offered a bullish outlook for Bitcoin, noting that the cryptocurrency is forming a familiar bottom at $80,000.
Related: Bitcoiners’ ‘bullish impulse’ on recession may be premature: 10x Research
Meanwhile, a maturing falling wedge pattern on the BTC price chart hints at a potential Bitcoin price rally toward $100,000, as Cointelegraph reported earlier.
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.
