This is the latest escalation in a geopolitical energy shock that forces a toxic mix of higher inflation expectations and tighter financial conditions. Bond vigilantes are demanding a higher term premium, which typically pressures all risk assets, but crypto's high BTC dominance suggests capital is rotating into Bitcoin as a relative safe haven within the asset class.

US Treasuries

The US bond market selloff deepened after President Donald Trump rejected Iran's latest proposal to reopen the Strait of Hormuz, threatening to prolong the war's energy shock.

Treasury Selloff Deepens After Trump Rejects Iran's Strait of Hormuz Proposal

Bond market turmoil from Strait of Hormuz closure will force the Fed's hand, inadvertently reigniting the 'debasement trade' that benefits Bitcoin.

Bitcoin

This is part of a broader trend of central banks diversifying away from US debt and using reserves for currency defense. It highlights the fragility of the current global monetary system, where intervention can have unintended cross-asset consequences. For crypto, it reinforces its role as a hedge against fiat debasement, but also exposes it to macro liquidity shocks.

Japan likely sold a portion of its foreign securities holdings, including US Treasuries, to finance its record currency intervention over the past month.

Japan Likely Sold US Treasuries to Fund Record Yen Intervention

Japan's Treasury Sell-Off Is a Stealth Bullish Catalyst for Bitcoin—Here's the Play

Gold Overtakes US Treasuries as Top Global Reserve Asset

Wellington Asset Management Moves from US Treasuries to German Bonds After Fed Meeting

Wellington Asset Management Shifts from US Treasuries to German Bonds

Saudi Arabia Threatens to Sell US Treasuries if Washington Strikes Iran

US Treasuries Rally as Oil Prices Drop on US-Israel-Iran Pause

Treasuries Rise, Oil Softens as Fed Rate Hike Looms — Crypto Stability in Focus

Tether Emerges as Major Buyer of U.S. Treasuries as Foreign Holdings Decline

Gold Surpasses US Treasuries in Central Bank Reserves, Bloomberg Data Shows

China Cuts US Treasury Holdings to 18-Year Low, Continues Gold Buying Streak

Europe's $200B US Treasury Holdings Pose Fiscal Risk, Study Warns

DTCC Moves US Treasuries to Canton Blockchain; Lighter’s LIT Platform Goes Live