Bitcoin stayed below $80,000 on Tuesday as rising Treasury yields, a jump in oil prices, and a looming Senate vote on crypto regulation weakened demand for risk assets. Ethereum and XRP also retreated even as most major tokens still held weekly gains, and traders now watch a packed week of inflation data and a Fed meeting for the market's next move.
Bitcoin traded below $78,800 on Tuesday and stayed under $80,000 after last week's gains. The total crypto market capitalization fell 0.43% to $2.69 trillion. The CMC20 index dropped 0.53% to $164.40.
Yet sentiment had not turned bearish outright. The Fear and Greed Index held at 72, still in "greed" territory even as prices slipped. Liquidations reached $165.44 million, with $114.75 million in long positions. Open interest rose 4.37% to $423.07 billion. Derivatives volume increased 0.52% to $610.36 billion.
Rate Hike Bets Pressure Bitcoin's $77,000 Support
Ethereum dropped 1% to $2,482, while XRP eased to $1.39, even though most major tokens still posted weekly gains that pointed to consolidation rather than a reversal.
Bitcoin's support at $77,000 might be tested again if macro pressure builds. Better August payrolls data boosted Treasury yields and reinforced bets on tight monetary policy. Traders now put the odds of a quarter-point Federal Reserve rate hike at about 60%. A rate hike tends to weigh on cryptocurrencies by reducing demand for speculative assets.
Oil Surge Tied to US-Iran Tensions Adds to Inflation Worries
Oil prices climbed as tensions between the United States and Iran escalated, pushing Brent crude above $97, its highest level in six weeks, after attacks on ships and military targets. Prices had already reached above $94 earlier, their highest level in three months, amid Iran's threatened economic warfare against the US, which raised concern over possible supply disruptions through the Strait of Hormuz.
Higher energy prices could keep inflation elevated until Friday's consumer price index report. A hot core CPI reading would push the odds of a rate hike to as high as two-thirds and put Bitcoin at risk of falling below its $77,000 support.
CLARITY Act Vote and Fed Meeting Loom This Week
Regulatory uncertainty is also weighing on sentiment ahead of a September 15 procedural vote on the CLARITY Act, when the Senate will attempt a cloture vote at 2:15 p.m. ET that needs at least 60 votes to advance. The 309-page bill would define regulatory oversight between the SEC and the CFTC. But Polymarket odds of its enactment in 2026 fell to 16% on September 6, down from 82% in February.
The week ahead also brings a ten-year Treasury auction Wednesday. Thursday includes PPI data, jobless claims, and a 30-year Treasury auction. The Fed announces its rate decision on September 16. The SEC holds a roundtable on crypto trading on September 17.
Source: CoinGape
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