Bitcoin extended its losses on Thursday as rising Treasury yields and a renewed jump in oil prices weakened demand for riskier assets.
The broader cryptocurrency market also moved lower. Investors took profits following strong gains across the sector earlier in September.
Bitcoin dropped 2.7% to around $84,149 by 02:14 ET, or 06:14 GMT.
Despite the latest decline, the world’s largest cryptocurrency remained firmly higher for the month. September’s gains were supported in part by growing optimism over a more favorable regulatory environment in the United States.
Bitcoin Falls as Treasury Yields Surge
Bitcoin’s latest decline came alongside weakness across other risk-sensitive markets as government bond yields climbed sharply.
The benchmark U.S. 10-year Treasury yield moved back above 5%, reaching its highest level since 2007.
Strong U.S. purchasing managers index data, combined with hawkish comments from a Federal Reserve official, increased expectations that interest rates could remain elevated or rise further.
The Federal Reserve raised interest rates by 25 basis points last week and repeated its commitment to bringing annual inflation back toward its 2% target.
Markets interpreted the central bank’s stance as a sign that additional monetary tightening could still be possible.
Global Bond Yields Move Higher
Bond yields also climbed across other developed markets as investors adjusted to expectations of tighter monetary policy.
Japan’s 10-year government bond yield reached its highest level in around 30 years on Thursday.
Higher interest rates can reduce demand for speculative assets such as Bitcoin because bonds and other fixed-income investments may become more attractive when yields rise.
Oil Prices Add to Market Concerns
A rebound in oil prices added another source of pressure for risk assets.
Crude prices moved higher overnight as expectations for progress in U.S.-Iran diplomatic relations appeared to weaken.
Oil markets were also influenced by comments from Iranian President Masoud Pezeshkian during an address at the United Nations General Assembly in New York.
His remarks included criticism of the United States and President Donald Trump, adding to uncertainty around geopolitical tensions.
Higher oil prices can also contribute to inflation concerns, potentially reinforcing expectations that central banks may need to maintain restrictive interest rates for longer.
Altcoins Follow Bitcoin Lower
Most major cryptocurrencies also declined on Thursday as weaker risk appetite encouraged investors to lock in profits.
The pullback followed strong gains across several altcoins earlier in the month.
Optimism over a more supportive U.S. regulatory environment had previously helped drive the rally, particularly after the Securities and Exchange Commission announced a five-year exemption related to blockchain-based stock offerings.
The development helped offset some concerns surrounding the Clarity Act after the legislation failed to advance through Congress.
Ethereum, XRP and Solana Decline
Ethereum, the world’s second-largest cryptocurrency, fell around 2.5% to $2,685.83.
XRP recorded a sharper decline of approximately 7.5%, dropping to $1.5052.
Solana fell 3.3%, while Cardano declined 7.1%. BNB also moved lower, losing around 2.5%.
Meme cryptocurrencies suffered even steeper losses. Dogecoin dropped 7.7%, while the TRUMP token slid approximately 11.4%.
The broader decline highlighted the cryptocurrency market’s continued sensitivity to interest rates, bond yields, oil prices and changes in global investor risk appetite.
