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As bitcoin regains its footing, optimism has returned to the market, and several observers are calling the recent price rise the start of a decisive bull run for valuations well beyond last year's $126,000 peak.
But a look back at trends in bitcoin and Nasdaq valuations, adjusted for the cost of capital represented by the U.S. 10-year yield (US10Y), suggests bull runs may be more measured. (check Today’s signal)
Both the BTC/US10Y and Nasdaq/US10Y ratios have failed to eclipse their 2020-2021 peaks, even though their dollar-denominated prices set new record highs over the past 12 months. In other words, when adjusted for the cost of capital, the true macro tops for bitcoin and the broader tech sector likely occurred in 2020-21.
This divergence between nominal prices and yield-adjusted valuations can resolve in one of two ways. Either interest rates collapse, shrinking the denominator and propelling these ratios toward a fresh breakout, or the dollar prices of these assets decline to realign with the structural weakness revealed by the ratios.
The latter scenario appears the more likely for two reasons. First, recent rhetoric from Fed officials has remained decidedly hawkish, with some even floating the possibility of interest-rate increases.
Complicating matters further is the resurgence of energy prices. Bitcoin’s recent bounce from $58,000 to $66,000 has been respectable, yet its ratio relative to WTI crude oil futures has declined. This confirms that oil is outperforming even the most aggressive risk assets, a hint that a new wave of cost-push inflation may be loading into the system.
The takeaway: Engineering a sustained bull run may be far more difficult than market participants perceive. If oil continues its ascent, we may see a sharp "snap adjustment," with nominal prices falling rapidly, consistent with their yield-adjusted valuations. Stay alert.
Read more: For analysis of today's activity in altcoins and derivatives, see Crypto Markets Today . For a comprehensive list of events this week, see CoinDesk's "Crypto Week Ahead."
The chart in the left pane shows bitcoin’s price adjusted for the 10-year Treasury yield. The ratio peaked in 2021, and the 2025 bull market in BTC fell short of challenging that high. Nasdaq displays a similar pattern.
Both suggest that bull runs may be more measured unless interest rates collapse.
Separately, the BTC-WTI crude oil ratio has come off in the past few days, a sign that energy is outpacing gains in digital risk assets. This could be a warning of another inflation wave ahead.