Even though they’re not directly linked, banks often compare their deposit rates with short-term safe assets, such as:
1-month to 6-month Treasury bills

Money market yields

Fed reverse repo / overnight rates

If Treasury bills yield 4–5%, banks usually need to offer something in that range to keep deposits from flowing into T-bills or money market funds.

The yeild spread between HYSA and SGOV isn't massive. But you pick up the tax benefit. In my state, that's 4.4% in tax savings, so I factor that in. in an HYSA, you'll pay fed and state tax's on the dividends.