Bitcoin hits record as stocks, bonds retreat amid market uncertainty

May 22, 2025 0 Comment

By: Ariel Z.

The price of Bitcoin broke its record on Wednesday, climbing to just shy of $110,000 to eclipse the previous high from January as risk sentiment continues to improve after last month’s tariff-induced sell-off.

The flagship cryptocurrency surged to as high as $109,693, or 2.2%, before giving up some of the gains to fall to around $108,000 at the close following concerns in the broader markets over rising Treasury yields, consumer headwinds and fiscal uncertainty in Washington.

Bitcoin’s surge capped a five-week rally fueled by institutional inflows, dollar weakness and optimism around regulatory clarity. The token is up more than 20% over that span.

“Price action in Bitcoin looks outright bullish,” Chris Weston, head of research at Pepperstone, told Barron’s on Wednesday.

“If the pullbacks remain limited and well supported, then a new record high could come into play.”

In equity markets, the Dow dropped nearly 2% – or more than 700 points as of 2 p.m. ET – as investors digested a volatile mix of earnings, economic data and legislative wrangling. The Nasdaq and the S&P 500 also were down about 1%.

The 30-year yield climbed above 5% again on Wednesday, while the benchmark 10-year rose to 4.54%, extending a global bond rout.

Higher yields reflect expectations for more expensive borrowing, which could dampen both economic growth and equity performance.

Concerns are mounting over a tax-and-spending package championed by President Trump. The bill – which would extend and expand tax cuts – is forecast to widen budget deficits by about $3 trillion over a decade.

Moody’s recently stripped the US of its final triple-A credit rating, exacerbating market worries and contributing to a spike in Treasury yields.

As risk sentiment erodes in traditional markets, investors are increasingly turning to Bitcoin as a haven asset.

“I am watching the global M2 money supply [the total amount of money circulating in the global economy and dollar weakness/confidence,” Steven McClurg, CEO of Canary Capital, told via email.

“Based on M2 alone, Bitcoin should reach $140,000 this year. After US Treasury downgrades, investors are shifting to BTC for safety.”

Another key driver behind the rally: institutional adoption.

“If you look at spot ETF flows, they offer key insights into the BTC rally since the Liberation Day market low,” Peter Chung, director of research at Presto Research, told.

“Data shows over $5 billion has flowed into Bitcoin ETFs. This spot-driven, no-leverage rally over the past five weeks forms a strong foundation for future BTC price action.”

Spot ETF flows refer to the movement of money into and out of spot exchange-traded funds — ETFs that directly hold the underlying asset, such as Bitcoin.

Chung noted that the dynamic could shift if the Federal Reserve cuts rates before July, narrowing spreads with short-term Treasury yields and reviving the once-popular basis trade.

Retailers including Target, Lowe’s and TJX reported mixed results Wednesday, revealing a fragile consumer landscape battered by tariffs and inflation. The Dow was also dragged lower by a decline in UnitedHealth after an HSBC downgrade.

Target cut its outlook, citing weaker discretionary spending and falling confidence, while discount-focused TJX held firm, benefiting from deal-hunting shoppers. Lowe’s kept its guidance unchanged.