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U.S. Treasury Market Most Volatile in 4 Months May Slow Any Bitcoin Price Recovery After CPI
Increased volatility in the Treasury market often leads to reduced risk taking in financial markets.
Mar 12, 2025, 2:45 p.m.
What to know:
- The U.S. Treasury market is seeing the highest volatility in four months, which could slow an expected recovery in the price of bitcoin.
- Some analysts forecast a BTC level of $90,000 and higher amid cooling inflation and persistent recession concerns.
The U.S. Treasury market is experiencing its highest volatility in four months, potentially jeopardizing an expected bitcoin (BTC) price recovery.
U.S. inflation data for February came in softer-than-expected, strengthening the case for Federal Reserve interest-rate cuts. The reading encouraged some analysts to forecast a bitcoin price recovery to $90,000 and higher. It's currently around $82,000.
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"With inflation cooling and recession fears still looming but not worsening, Bitcoin could be on the verge of its next major breakout, pushing past the stubborn sub-$90K range," Matt Mena, Crypto Research Strategist at 21Shares, said in an email.
Any upswing, however, could unfold slower than expected as the Merrill Lynch Option Volatility Estimate Index (MOVE), which measures the expected 30-day volatility in the U.S. Treasuries market, has risen to 115, the highest since Nov. 6, according to data source TradingView. It has jumped 38% in three weeks.
Increased volatility in the U.S. Treasury notes, which dominate global collateral, securities and finance, negatively impacts leverage and liquidity in financial markets. That often leads to reduced risk-taking in financial markets.
The MOVE index collapsed following the Nov. 4 election, easing financial conditions that likely aided BTC's surge to as high as $108,000 from $70,000.
The cryptocurrency's rally peaked in December-January as the MOVE bottomed out.
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Exchange Review - March 2025
CoinDesk Data's monthly Exchange Review captures the key developments within the cryptocurrency exchange market. The report includes analyses that relate to exchange volumes, crypto derivatives trading, market segmentation by fees, fiat trading, and more.
What to know:
Trading activity softened in March as market uncertainty grew amid escalating tariff tensions between the U.S. and global trading partners. Centralized exchanges recorded their lowest combined trading volume since October, declining 6.24% to $6.79tn. This marked the third consecutive monthly decline across both market segments, with spot trading volume falling 14.1% to $1.98tn and derivatives trading slipping 2.56% to $4.81tn.
- Trading Volumes Decline for Third Consecutive Month: Combined spot and derivatives trading volume on centralized exchanges fell by 6.24% to $6.79tn in March 2025, reaching the lowest level since October. Both spot and derivatives markets recorded their third consecutive monthly decline, falling 14.1% and 2.56% to $1.98tn and $4.81tn respectively.
- Institutional Crypto Trading Volume on CME Falls 23.5%: In March, total derivatives trading volume on the CME exchange fell by 23.5% to $175bn, the lowest monthly volume since October 2024. CME's market share among derivatives exchanges dropped from 4.63% to 3.64%, suggesting declining institutional interest amid current macroeconomic conditions.
- Bybit Spot Market Share Slides in March: Spot trading volume on Bybit fell by 52.1% to $81.1bn in March, coinciding with decreased trading activity following the hack of the exchange's cold wallets in February. Bybit's spot market share dropped from 7.35% to 4.10%, its lowest since July 2023.
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What to know:
- Ethena's USDe becomes fifth stablecoin to surpass $10 billion market cap in just 609 days, while Tether's dominance continues to slip.
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