Bitcoin Falls Below $77,000 as Higher Yields, Oil Surge Limit Buying Appetite

Bitcoin fell below $77,000 as rising US Treasury yields and a sharp jump in oil prices added pressure to the market, CoinDesk reported on May 18.

Bitcoin briefly dropped under $77,000 during Asian trading hours, according to the report. It was trading at $76,808.17 on Binance's USDT market, down 1.63% from a day earlier.

CoinDesk said the recent pullback came as the macro backdrop turned less favorable for digital assets. The yield on the 30-year US Treasury climbed to 5.13%, the highest since 2007. Yields on the 10-year and two-year Treasuries also rose to their highest levels in the past year.

On prediction market platform Polymarket, traders are pricing in a 98% chance that the Federal Reserve will hold rates steady in June and a 94% chance of another pause in July.

Markets are also viewing the prospect of higher rates for longer as a headwind for Bitcoin sentiment. Rising interest rates typically reduce the relative appeal of assets such as Bitcoin that do not generate yield.

On-chain indicators, however, painted a mixed picture. Citing Glassnode data, Binance Research said about 60% of Bitcoin's total supply has not moved in more than a year. Bitcoin holdings on exchanges have also fallen to their lowest level in six years.

At the same time, the STH MVRV metric, which measures profitability for short-term holders, remained below 1. That suggests investors who bought Bitcoin recently are, on average, sitting on losses. Market participants say that could make sentiment more fragile if prices decline further.

Presto Research identified Nvidia's earnings this week, the US Producer Price Index and discussions around the CLARITY Act, a US crypto market structure bill, as key variables to watch.