Bitcoin retreated below $77,000 on Monday, sliding 2.1% to $76,753 as a confluence of rising bond yields, surging oil prices, and a wave of forced liquidations dampened risk appetite across digital assets. The move brings the cryptocurrency back near a two-week low, with the $80,000 level—briefly reclaimed last week—now acting as resistance.
Macro Headwinds Intensify
The sell-off was driven by a sharp rise in U.S. Treasury yields, with the 10-year note climbing to 4.631% and the 30-year bond reaching 5.159%. Higher yields offer investors a risk-free return, making speculative assets like bitcoin less attractive. Meanwhile, Brent crude traded near $110.50 a barrel amid fresh geopolitical tensions in the Gulf, adding to inflationary concerns.
“The market is panicking over the risk that the Strait of Hormuz remains shut,” said George Lagarias, chief economist at Forvis Mazars, as reported by Reuters. The energy price spike has reignited fears of a prolonged period of elevated inflation, which could force central banks to maintain tighter monetary policy.
Liquidations Amplify Selling Pressure
The downturn was exacerbated by forced closures of leveraged positions. According to The Economic Times, nearly $661 million in crypto positions were liquidated over 24 hours. Ether fell 3% to $2,114, while Solana and XRP also posted losses. Analysts pointed to a rejection near the $82,000 resistance zone, with the market adopting a risk-off stance.
“Bitcoin has slipped back below the psychological $80,000 level, but we are not yet seeing a full capitulation signal,” said Vikram Subburaj, CEO of Giottus, as quoted by The Economic Times.
Fed Minutes in Focus
The next major catalyst for markets will be the release of the Federal Reserve’s minutes from its April 28-29 meeting on May 20 at 2 p.m. EDT. Traders will scrutinize the document for any shift in policymakers’ views on inflation versus growth risks. A more hawkish tone could further pressure risk assets, while a dovish surprise might trigger a relief rally.
Kenneth Broux at Societe Generale told Reuters that stopping the bond market’s “slow-motion crash” would require lower oil prices, enough recession fear to pull buyers into bonds, or cheaper levels that attract demand. For bitcoin, the path forward hinges on whether yields stabilize or continue to climb.
Regulatory Progress Offers Modest Support
On the regulatory front, the U.S. Senate Banking Committee advanced the Clarity Act last week, a bill aimed at defining how cryptocurrencies are regulated. While this provides a cleaner medium-term outlook for the sector, it was insufficient to offset Monday’s macro-driven selling. Reuters noted Democratic concerns over anti-money-laundering rules and potential conflicts of interest involving political officials.
Outlook: Key Levels to Watch
The $80,000 area had become a key support level for short-term traders after last week’s attempted rebound. If oil prices retreat or the Fed minutes sound less hawkish than feared, bitcoin could attempt to recover that level. However, if yields keep rising and leveraged longs continue to be forced out, the $76,000 area may not hold for long.
The broader market context suggests that bitcoin is currently trading less like an inflation hedge and more like a speculative asset that gets sold when investors anticipate higher rates and tighter liquidity. The coming days will be critical in determining whether the current pullback is a temporary correction or the start of a deeper downturn.
