Bitcoin’s strong start to March has reversed, with the cryptocurrency falling from over $76,000 to near $66,126. The shift is driven by rising U.S. Treasury yields pressuring risk assets, outflows from U.S. spot Bitcoin ETFs, and surging oil prices that fuel inflation concerns.
Bitcoin began March with strong momentum, rallying to a high of $76,000 and positioning for its first bullish monthly close in half a year. However, that narrative has since unraveled as early optimism gave way to macro-driven caution.
The U.S. 10-year Treasury yield has emerged as a central driver, potentially consolidating within a bullish flag pattern. A confirmed breakout could push yields toward 5.0% or higher, accelerating capital rotation out of risk assets like Bitcoin.
Higher yields strengthen the appeal of fixed-income instruments, drawing liquidity away from speculative markets. Between October 2021 and December 2022, yields rose from 1.45% to 3.90% while Bitcoin fell from $67,000 to $16,256.
Institutional sentiment in the U.S. is beginning to turn, as Spot Bitcoin exchange-traded funds recorded their first meaningful outflows in five weeks. Roughly $296 million exited these funds over the past week, reversing part of the $2.12 billion accumulated previously.
Late-February data reflected this trend, with outflows reaching approximately $396.7 million between 26-27 February alone. With only a few trading sessions left in March, sustained selling could now cement the bearish monthly close.
The inflation backdrop remains a key variable, with crude oil prices surging sharply. Brent crude climbed from around $75 to approximately $106, while WTI crude was trading near $101, alluding to supply disruptions and geopolitical tensions.
Persistently high energy prices limit the likelihood of near-term monetary easing, keeping yields elevated. Recent analysis pointed to oil-driven inflation as a direct headwind for Bitcoin, particularly amid disruptions tied to the Strait of Hormuz.
