U.S. 10-year Treasury yield climbs to 5.365%; Bitcoin retreats 2.5% in 24 hours
$550 million in leveraged positions liquidated; CFTC moves toward independent regulation after Senate stalls CLARITY Act
Bitcoin is experiencing significant volatility, fluctuating around the $83,000 mark. A combination of U.S. long-term Treasury yields soaring to their highest levels in 24 years and a surging dollar has heightened caution across the virtual asset market. In the United States, as efforts to formalize a regulatory framework for crypto assets have hit a legislative wall in the Senate, market participants are shifting their focus to independent regulatory measures being pursued by oversight agencies.
As of 10:15 a.m. on the 8th, Bitcoin was trading at $83,339, down 2.5% from the previous 24 hours, according to the global crypto market data platform CoinGecko. Over the past day, the asset has oscillated between $81,842 and $85,442, reflecting heightened market sensitivity.
U.S. Treasury yields at 24-year high; focus shifts to $82,500 support level
The sharp rise in U.S. Treasury yields has become a primary headwind for the crypto market. The 10-year U.S. Treasury yield touched 5.365% during trading on the 7th, the highest level since April 2002. The 30-year yield also reached 5.732%, its highest point since May 2002. Furthermore, the dollar index reclaiming the 102 level has placed additional pressure on crypto investment sentiment.
Geopolitical tensions in the Middle East have further exacerbated market anxiety. Reports of an attack on an oil tanker in the Strait of Hormuz have reignited fears regarding potential disruptions to oil supplies and subsequent inflationary pressure. The convergence of rising bond yields and geopolitical instability has prompted investors to steer clear of riskier assets.
The price correction has triggered a wave of forced liquidations among leveraged investors. Citing data from Coinglass, the industry outlet CoinDesk reported that approximately $550 million worth of crypto leveraged positions were liquidated over the past 24 hours as Bitcoin dipped below $84,000. The unwinding of these borrowed positions has intensified price volatility.
Market maker Wintermute has identified $82,500 as a key short-term support level for Bitcoin. Maintaining this price floor could allow the asset to sustain its recent bullish trend, whereas a breach could invite further selling pressure.
CLARITY Act stalls in Senate; CFTC pursues independent regulation
Beyond short-term price adjustments, uncertainty persists regarding the integration of crypto assets into the institutional fold in the U.S.
On September 15, the U.S. Senate failed to secure the 60 votes required to proceed with the deliberation of the "CLARITY Act," a comprehensive bill aimed at structuring the crypto market. The legislative process stalled as all Democratic senators and four Republicans opposed the motion.
The CLARITY Act was designed to delineate the oversight jurisdictions of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) based on the legal classification of crypto assets, while establishing a federal regulatory framework for digital asset exchanges and related businesses.
However, lawmakers failed to bridge their differences over concerns regarding conflicts of interest tied to Donald Trump’s crypto-related business ventures, as well as competing demands from the financial sector. Democrats pushed for stricter limitations on the holding and trading of digital assets by public officials, a stance the Republicans were unwilling to accept.
With congressional legislation at a stalemate, U.S. regulators are moving to overhaul oversight based on existing laws. On the 5th, the CFTC announced an Advance Notice of Proposed Rulemaking (ANPRM) aimed at supervising leveraged and margin-based crypto trading for retail investors.
The CFTC is currently reviewing requirements that would allow crypto exchanges to register under a new federal oversight category, which would include mandates for market-manipulation prevention and proof-of-reserves. However, these rules have not yet been finalized or implemented, and the agency does not currently possess comprehensive authority over the entire spot crypto market.
U.S. heads toward November midterms; eyes on the future of crypto institutionalization
The friction surrounding crypto legislation appears to be spilling over into the political arena ahead of the U.S. midterm elections this November.
Reuters reported on the 7th (local time) that the U.S. crypto industry is reconsidering its political funding strategies following the failure of the CLARITY Act in the Senate. After pouring over $300 million into supporting crypto-friendly candidates from both parties over the last two election cycles, the industry is now questioning whether to maintain its bipartisan support strategy given the stark divide between the parties during the legislative process.
While the U.S. has made strides toward institutionalizing digital assets—most notably through the passage of the "GENIUS Act" for stablecoin regulation last year—the broader CLARITY Act remains stuck, and the CFTC’s new regulatory proposals are still in the public comment phase.
In the short term, U.S. Treasury yields, the trajectory of the dollar, and the volume of liquidations are expected to dictate crypto price movements. The path toward institutionalization will likely become clearer depending on whether Congress reintroduces market-structure legislation and how the CFTC’s rulemaking process unfolds.
