When safe assets compete with risk. Lessons from the 1960s–90s for bitcoin and stocks.

Crypto Daybook AmericasWhen safe assets compete with risk. Lessons from the 1960s–90s for bitcoin and stocks.Your day-ahead look for Aug. 11 2026By Omkar Godbole|Edited by Sheldon Reback1 hr ago3 min readMake preferred on ShareShare this articleCopy linkX iconX (Twitter)LinkedInFacebookEmailMake preferred on SummaryShowThis is an excerpt from CoinDesk newsletter 'Daybook.' Sign up here, if you haven't already.Financial markets’ risk-free rate, the yield on U.S. Treasury securities, is rising again. Crypto maximalists often dismiss this as background noise, but when the rate rises sharply, it often competes for capital with stocks and other assets. History shows that the resulting market adjustments tend to be painful. Jurrien Timmer, director of global macro at Fidelity Investments, highlighted this dynamic in an X post, noting that rising Treasury yields from the 1960s through the mid-1990s made government bonds competitive with equities. Investors who ignored the higher opportunity cost of capital learned the hard way from the 1987 crash, known as Black Monday. The Oct. 19 crash sent the Dow Jones Industrial Average plunging by 508.32 points, or 22.6%, in a single day. It’s still the largest one-day percentage drop in history.Timmer’s reminder is timely, as yields have generally been rising since the Covid market crash in 2020, echoing the beginning of the multi-decade uptrend that started in the late 1950s. Right now, the 30-year yield is hovering at its highest level since 2007 and could rise further if Wednesday's U.S. CPI beats estimates, validating higher-for-longer Fed interest-rate expectations. If yields increase, every other asset, including stocks and bitcoin, will need to justify its price with stronger earnings or cash flows. For bitcoin, the situation is more complex than for stocks because the cryptocurrency has neither earnings nor cash flow. Its value rests entirely on its appeal as a perceived digital gold and a hedge against fiat currency depr…

When safe assets compete with risk. Lessons from the 1960s–90s for bitcoin and stocks.

Coins in this story

Discussion

Related stories

MoneyGram expands on Solana with global crypto-to-cash service

Morning Minute: Saylor's Strategy Sells Bitcoin for Second Week in a Row

Australian watchdog suspends Cryptolink, forcing 96 ATMs offline