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Huobi HTX Chief Analyst Cloud: The Bitcoin pullback is a normal retracement, and the differentiation of altcoins may continue until this week's data is released

The 10-year U.S. Treasury yield returned to above 5.2% overnight, reaching a high not seen since 2007, putting pressure on global risk assets. Bitcoin has fallen back to around $83,000, with altcoins experiencing even larger declines. In this regard, Cloud, the chief analyst at Huobi HTX, believes that this drop is more akin to a normal pullback after a rebound and does not constitute the starting point of a trend reversal. The high U.S. Treasury yields mainly suppress valuations, with limited impact on the overall liquidity. The funding structure and holding costs of the crypto market itself have also not been disrupted. This round of decline seems more like a clearing of positions before key data is released.It is important to be cautious about the divergence between Bitcoin and altcoins. During a phase of marginal liquidity tightening, funds tend to concentrate on the most certain top assets; altcoins lack incremental funds to support them, and with heavier leverage, their pullbacks are therefore amplified. This divergence is likely to continue before the release of this week's PCE and non-farm data. If the data falls short of expectations, altcoins will have greater elasticity and thus higher risks; if the data exceeds expectations, Bitcoin's relative strength will be more pronounced. Whether Bitcoin can stabilize at key support levels will be the main signal to determine if this round of pullback has ended.Note: The content of this article does not constitute investment advice, nor does it constitute any offer, solicitation, or recommendation of investment products.

Analysis: Global debt continues to rise, Bitcoin benefits from the decline in fiat currency purchasing power

According to Forbes, Bitcoin approached $90,000 earlier this month. Meanwhile, global debt continues to rise, and the "currency depreciation trade" surrounding the decline in purchasing power of fiat currency has become one of the factors driving up assets like Bitcoin and gold.Data from the Institute of International Finance shows that global debt increased by $10 trillion in the first half of this year, surpassing $365 trillion in total. The U.S. debt has exceeded $40 trillion, with annual interest payments rising to $1.27 trillion, surpassing defense and Medicare spending, and only lower than Social Security spending. The institute warns that as benchmark interest rates rise, interest costs will also increase.Nic Puckrin, founder of Coin Bureau and cross-asset analyst, stated that the current environment is favorable for "currency depreciation assets" like Bitcoin and gold, which is part of the reason for Bitcoin's recent rise. The larger the debt of major economies, the more likely it is to suppress real borrowing costs and allow inflation to erode the real value of debt, thereby enhancing the attractiveness of such trades.Analysts from The Kobeissi Letter pointed out that the purchasing power of the dollar has declined by 23% since 2020; if assets only increased by 30% during the same period, investors have essentially just broken even in terms of real purchasing power. The U.S. inflation rate has been above the Federal Reserve's 2% target for 60 consecutive months.
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