Bitcoin Drops Swiftly from All-Time High Following Surge in Interest Rates Affecting Risk Markets

Bitcoin’s rally encountered resistance near $110,000 on Wednesday, retreating after reaching a new record amid jitters in the U.S. Treasury bond market.

The leading cryptocurrency soared to an intraday peak of $109,754 before retreating about 3% to the $106,000 range, later settling just above $107,000 according to CoinDesk’s Bitcoin Price Index. Ethereum (ETH) and Solana (SOL) also softened after initial gains.

Market participants cited profit-taking following Bitcoin’s near 50% gain over the past five weeks, but the catalyst for broader risk-off sentiment was a poorly received U.S. Treasury auction. Demand for 20-year Treasury bonds faltered, pushing the 30-year yield to 5.07%, its highest in over two years.

This sent ripples through equities, with the Nasdaq tumbling 1.5% and the S&P 500 shedding 1.3% within an hour.

Josh Mandell, an experienced fixed-income analyst turned Bitcoin strategist, called the weak auction a “ticking time bomb” that poses systemic risks.

“When there’s a missed auction, it means bids don’t fully cover supply. Without Federal Reserve intervention, this could cause bond rollover failures and potential defaults,” Mandell warned.

Kirill Kretov of CoinPanel noted that diminished liquidity on crypto exchanges since late 2024 has made Bitcoin’s price swings more volatile and unpredictable.

“Structurally, Bitcoin has upside potential, but sharp corrections are always a risk in the current environment,” Kretov said.

Technical analyst Skew flagged $110,000 as a critical resistance zone, highlighting a cluster of sell orders and increased short positions on Binance futures that create heavy supply pressure.

“This price level is a pivotal liquidity point that will determine Bitcoin’s next directional move,” Skew explained.