Bond Yields

Definition ∞ Bond yields represent the return an investor receives on a bond, expressed as a percentage of its current market price. This yield is inversely related to bond prices; when prices rise, yields fall, and vice versa. It reflects the income generated by the bond relative to its cost, considering interest payments and maturity value. Yields are a primary indicator of market interest rates and perceived credit risk for the issuing entity.
Context ∞ Fluctuations in traditional bond yields frequently influence investor sentiment and capital allocation decisions within the crypto market. News reports often analyze how rising or falling government bond yields impact the attractiveness of riskier assets, including cryptocurrencies. A key discussion involves the correlation between bond market movements and digital asset valuations, particularly for stablecoins and DeFi lending protocols. Monitoring bond yields provides valuable insight into broader macroeconomic trends affecting digital asset performance.