[Bitcoin Now] 8% Drop Overnight... Impact of US Treasury Rate Hike on the Coin Market

Still Divided Opinions... Bitcoin as 'Yeousa-nyang' VS Future Reserve Currency

Bitcoin (Image=Getty Images Bank)

[Asia Economy Reporter Gong Byung-sun] The surge in the US 10-year Treasury yield has impacted not only the stock market but also the cryptocurrency market. Bitcoin, the leading cryptocurrency, which had recovered to the 58 million KRW range the previous day, plummeted to the 54 million KRW range.

According to the domestic cryptocurrency exchange Upbit, as of 10:40 AM on the 26th, Bitcoin was recorded at 54,195,000 KRW, down about 0.23% compared to the previous day. It had rebounded to 58,890,000 KRW at 10:12 PM the previous day but dropped more than 8% overnight.

The rise in US Treasury yields appears to have acted as a negative factor. On the 25th (local time), the US 10-year Treasury yield exceeded 1.5%, reaching as high as 1.614% during the day. The cryptocurrency market has previously been affected by interest rate changes. Earlier, on the 11th of last month, when the US Treasury yield recovered to the 1% range for the first time in 10 months, Bitcoin fell 7.63% compared to the previous day. Since the cryptocurrency market grew amid liquidity expansion, concerns arose that liquidity could decrease due to interest rate hikes.

Meanwhile, opinions among investment moguls about Bitcoin's future diverged. On the 24th (local time), according to the US economic media CNBC, Charlie Munger, Vice Chairman of Berkshire Hathaway operated by Warren Buffett, attended the Daily Journal shareholders' meeting and likened investing in Bitcoin to 'fox hunting.' He criticized that, just as British aristocrats in the past hunted not for food or leather but purely for the sake of hunting itself, investing in Bitcoin is meaningless. He said, "I don't understand why Bitcoin's price surged," and pointed out, "Bitcoin's volatility is too high to serve as a medium of exchange."

On the other hand, Cathie Wood, CEO of Ark Investment, highly praised Bitcoin. According to US economic media Bloomberg on the 25th (local time), Wood argued that "Bitcoin should be considered a new asset because it can serve as a future reserve currency (a currency held by countries for external payments like gold)." Earlier, on the 8th (local time), when Tesla disclosed that it had purchased about 1.5 billion USD (approximately 1.68 trillion KRW) worth of Bitcoin, she evaluated on Twitter that "using Bitcoin as a hedge is a wise decision."

This content was produced with the assistance of AI translation services.