Bitcoin dropped below the $70,000 mark on Friday after losing nearly 7 percent in 24 hours, its weakest level since August 20. On Binance, the world’s largest cryptocurrency exchange by trading volume, the coin fell 6.74 percent over the past day and traded at $68,868.39 as of early morning on Friday.

Rising expectations of Federal Reserve rate hikes were the main force behind the drop, lifting both the dollar and bond yields, which tend to weigh on bitcoin.

The shift began on Tuesday with October inflation data. Consumer prices rose 0.4 percent against a forecast of 0.3 percent, and core inflation, which excludes food and energy, gained 0.3 percent against an expected 0.2 percent, Bureau of Labor Statistics data showed. Federal Reserve Governor Christopher Waller had said a core reading of 0.3 percent could justify a half-point rate hike in December, Reuters reported.

Traders now see about a 90 percent chance of a quarter-point increase at that meeting and roughly 10 percent for a half-point move, with the benchmark rate at 3.75 to 4 percent. Stronger-than-expected job growth in last week’s employment report had already fed bets on further tightening.

Why higher yields, stronger dollar hit bitcoin

The rate expectations pushed the 10-year Treasury yield back to about 5 percent on Tuesday, CNBC reported, after it reached 24-year highs in October. The two-year yield, which tracks near-term Fed expectations, jumped more than 18 basis points to 4.74 percent. When government bonds pay that much, investors have less reason to hold bitcoin, which pays no interest.

The dollar strengthened too. The US Dollar Index, near 102.3 after the inflation release, climbed above 103 on Friday, its highest level since April 2025. A stronger dollar makes dollar-priced assets costlier for buyers in other currencies, which can cut demand.

Stocks also fell after the inflation report, and renewed weakness in technology shares added to the retreat from risk on Friday. Bitcoin often moves in step with risk assets.

Fund outflows and forced selling

Investors have also been pulling money out of US spot bitcoin exchange-traded funds (ETFs). About $300 million left the funds on Wednesday and another $47.7 million on Thursday, Proactive Investors reported, bringing withdrawals to roughly $2 billion over three weeks.

Forced selling amplified the drop. Exchanges automatically shut down more than $1.3 billion worth of crypto futures positions over 24 hours. These were trades opened with borrowed money that traders could no longer cover once prices fell. Bitcoin accounted for $677 million of the total, and nearly $500 million was wiped out in the single hour when the price broke below $70,000.

Bitcoin traded above $76,000 earlier this week and has lost about 9 percent over seven days, heading for a sixth straight weekly loss. CryptoTicker quoted analysts saying the price will struggle to recover while it stays below its 200-day average, near $73,000.

Escalation in West Asia

The sell-off deepened amid fresh escalation along the Strait of Hormuz. The Islamic Revolution Guard Corps (IRGC) announced that it had destroyed a US early-warning radar in Bahrain, in response to an attack on a communications tower in Sirik, a coastal town in southern Iran. The IRGC cautioned companies cooperating with the US on oil shipments through the strait that they would face tougher penalties.

CoinDesk placed the acceleration of the sell-off alongside these developments, while pointing to the dollar and Fed expectations as the main drivers.