Bitcoin (BTC) continues to fall below $70,000 on Tuesday, and data suggests the risk of fresh year-to-date lows remains risky if bulls fail to turn this level into support.
Bitcoin’s price surged as U.S. market volatility rose again above critical levels and Treasury yields suffered their sharpest weekly decline in months.
Analysts suggest that this macro backdrop may indicate a prolonged slowdown in the BTC price, while onchain data shows that investors are still waiting for a stronger upside catalyst.
Key takeaways:
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The CBOE Volatility Index of 22.50 signals increasing market volatility and risk-free positioning for investors.
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The U.S. 10-year Treasury yield was at 4.02%, down 3.75% last week, approaching the 200-day moving average trend for the first time since March 2022.
Why Bitcoin may remain a “risky” asset for now.
The CBOE Volatility Index (VIX), which measures 30-day volatility expectations for U.S. stocks, rose to 22.50 in 2026 and is approaching its highest level since November 21, 2025.
A rising VIX typically reflects increasing uncertainty and reduced appetite for risky assets, a “risk-off” setup that has put pressure on Bitcoin in the past.
For context, the chart shows a repeating inverse pattern between Bitcoin and VIX around the 20 level. When the VIX rose above 20 in December 2024, BTC peaked at $104,000. The stronger rally above 25 during March-April 2025 coincided with a acute correction in BTC to $80,000.
The next move above 20 in the fourth quarter coincided with Bitcoin’s cycle high near $126,000, and BTC’s drop below $100,000 also occurred as the VIX crossed the threshold.
Meanwhile, the 10-year U.S. Treasury yield fell 3.75% last week, the sharpest weekly decline since September 2025. Currently at 4.02%, the yield is set to retest its 200-period basic moving average (SMA) for the first time since March 2022.
Falling yields reflect a defensive position in established markets, reinforcing a cautious tone.
The Crypto Fear & Greed Index dropped to 7 last week, one of the lowest readings on record. Bitwise asset management company explained in his weekly newsletter that while extreme fear has leveled out cycle bottoms, the BTC supply on the profit chain only briefly touched 50% during the recent sell-off. This level has historically marked deeper resets in bear markets.
Related: Bitcoin accumulation wave brings 80,000 back into the game dollars: analyst
Stablecoin liquidity growth is slowing
CryptoQuanta data can be seen that stablecoin reserves increased by $11.4 billion in the 30 days to November 5, 2025, reflecting the powerful purchasing power entering the market.
However, as the bear phase progressed, stablecoin reserves fell by $8.4 billion by December 23, 2025, signaling capital withdrawal.
Over the past month, reserves on various exchanges have fallen by a modest $2 billion. This marked a slowdown from the acute outflows in the fourth quarter, but the lack of significant inflows indicated tight liquidity conditions.
Binance dominated exchange liquidity, holding $47.5 billion in USDT and USDC reserves, accounting for approximately 65% of total centralized exchange balances, including $42.3 billion in USDT, up 36% year-on-year.
Regarding stablecoin inflows and reserves, cryptocurrency analyst Maartunn he said USDC inflows to exchanges are trending down again, indicating that fresh liquidity has not yet returned on a vast scale.
Related: Crypto Market Sentiment Is Extremely Fearful as Matrixport Marks Possible Bottom
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