Volatility in the U.S. Treasury market has risen to its highest level since March, but bitcoin and U.S. equities have yet to show a similar reaction. Bitcoin’s BVIV and Wall Street’s VIX remain close to their respective yearly lows, highlighting a growing gap between bond markets and risk assets.
The MOVE index, a measure of expected volatility in U.S. Treasury securities, rose from about 80 on Tuesday to 104 on Thursday. CoinDesk data shows that the reading is the highest since March, when MOVE surged to 199.
Bitcoin options markets remain relatively quiet. Volmex’s annualized 30-day Bitcoin Implied Volatility Index, or BVIV, was around 37, close to its year-to-date low of 35. The gauge reflects the level of price volatility that bitcoin options traders expect over the coming four weeks.
The Cboe VIX, which measures expected volatility in the S&P 500, was also near its year-to-date low of 14. The subdued readings suggest that neither market has seen the same increase in volatility demand currently visible in Treasuries.
The contrast could reflect resilience across bitcoin and equities. Treasury securities are central to global financing and credit markets, so increased volatility in the bond market can contribute to tighter financial conditions and potentially reduce appetite for riskier assets.
Treasury Yields Move Higher
The increase in bond volatility comes as government bond yields rise around the world. Higher oil and diesel prices linked to the war in the Middle East have complicated the inflation outlook and raised questions about how much additional monetary tightening central banks may need to consider.
The U.S. 10-year Treasury yield briefly reached 5.2% on Thursday before easing to 5.163%.
When the MOVE index was last near this level in March, the S&P 500 was trading around 6,350. It has since climbed to 7,704, an increase of roughly 21%. At the same time, bond traders are paying significantly more for protection against fluctuations in interest rates.
The relationship between bond volatility and equity volatility has also changed. The 20-day correlation between the VIX and MOVE fell to −0.06, becoming negative for the first time since April 2024, although the figure remains close to zero.
The correlation between BVIV and MOVE is more pronounced at −0.37, one of the lowest readings in years. As Treasury volatility has accelerated, bitcoin’s expected volatility has instead remained near its annual low.
CoinDesk reported earlier this week that rising Treasury yields alone have not demonstrated a consistent relationship with bitcoin returns, suggesting that higher bond yields do not necessarily translate directly into weaker BTC performance.
