Fed high-yield distress index hits record low as liquidity bypasses Bitcoin

Beincrypto reports the New York Federal Reserve's high-yield distress index has fallen to 0.06, an all-time low, indicating the healthiest corporate borrowing conditions on record. The index, which tracks liquidity conditions, market functioning and the ease of corporate borrowing, plunged from readings above 0.60 during the 2020 pandemic and near 0.80 in 2008.

High-yield corporate bond ETF HYG has rallied for a third straight year, with roughly 9% returns in 2025 according to iShares, but on-chain data cited by CryptoQuant CEO Ki Young Ju shows capital inflows into Bitcoin have "dried up" as money rotates to equities and gold. US equity indices sit near all-time highs and AI and Big Tech stocks are absorbing much of the available risk capital.

Derivatives data show total Bitcoin futures open interest at $61.76 billion across 679,120 BTC, with open interest up 3.04% over 24 hours and price action range-bound near $91,000, with $89,000 as near-term support; Binance leads with $11.88 billion (19.23%), CME with $10.32 billion (16.7%) and Bybit with $5.90 billion (9.55%).

Key Topics

Crypto, New York Fed, High-yield Distress Index, Bitcoin, Microstrategy, Ki Young Ju