A global bond sell-off wiped $670 million in leveraged crypto longs as the U.S. 10-year yield hit its highest level since February 2025, with rate-cut odds collapsing to 2%.
Posted May 18, 2026 at 5:24 am EST.
Bitcoin slid below $77,000 Monday, extending a four-day decline and triggering a leveraged long liquidation cascade that wiped $670 million in positions over 24 hours. The vast majority of the damage hit long bets, led by bitcoin and ether, according to CoinGlass data. Solana fell 5% to $87. XRP dropped 5%. Crypto-linked equities, including Coinbase, Circle, and Galaxy, each fell roughly 8% Friday.
The U.S. 10-year Treasury yield topped 4.5% Friday and climbed to 4.63% by Sunday night, the highest since February 2025. The Kobeissi Letter noted that the yield is now roughly 4 basis points above the level that prompted President Trump’s 90-day tariff pause in April 2025, and up 70 basis points since the Iran conflict began. U.K. 10-year gilt yields surged to 5.2%, the worst since 2008. Japan’s 30-year debt hit 4% for the first time.
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Market participants now see roughly 50% odds of at least one Fed rate hike by year-end and nearly zero chance of any rate cut in 2026, according to CME FedWatch. U.S. inflation is nearing 4%, and mortgage rates are approaching 7%. Trump escalated geopolitical tensions Sunday with a TruthSocial post warning Iran that “the Clock is Ticking” and “there won’t be anything left of them.” Brent crude has settled above $105, with the Strait of Hormuz effectively closed.
Bitcoin’s 200-day simple moving average near $82,000 has rejected the price four times in two weeks, and the failed breakout has resolved to the downside. Spot Bitcoin ETFs shed roughly $1 billion in net outflows over the past week, snapping a six-week inflow streak that had accumulated $3.4 billion. Tokenized Treasury products hit a record $15.35 billion in total value locked as rising yields make onchain yield instruments more attractive relative to spot crypto.
The structural counterweight remains long-term holders. Binance Research data shows exchange balances near six-year lows, and long-term holders still control a record 4 million BTC. But underwater short-term holders leave bitcoin vulnerable to further macro shocks heading into new Fed chair Kevin Warsh’s first FOMC meeting on June 16-17.
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