U.S. Employment Data Deals a Blow to Rate Cut Expectations: Why Is Bitcoin the First to React?

The macroeconomic trend has always been the thermometer for risk assets. For Bitcoin, nothing moves prices more than liquidity expectations.

Yesterday, the U.S. Bureau of Labor Statistics released surprisingly strong January non-farm payroll data: 130,000 new jobs, nearly double market expectations (around 70,000); at the same time, the unemployment rate unexpectedly dropped to 4.3%. This report shows that the U.S. economy is far from overheating, but it also effectively closes the market’s short-term rate cut expectations from the Federal Reserve.

For Bitcoin, currently struggling in a liquidity quagmire, this is a clear stress test. This article will analyze how employment data influences crypto markets through rate cut expectations, and combine the latest market data from Gate to explore Bitcoin’s real situation under macro headwinds.

Strong Non-Farm Payrolls: Why “Good Data” Becomes Bad News for Bitcoin

From a traditional economic perspective, strong employment and falling unemployment are signs of a healthy economy. However, in February 2026, this health report caused risk assets to collectively plunge.

The core transmission chain is very clear:

Better-than-expected non-farm jobs → Reduced urgency for Fed rate cuts → U.S. Treasury yields spike, dollar remains strong → Opportunity cost of holding Bitcoin rises → Capital flows out of risk assets

After the data release, traders quickly pushed back the timing of the Fed’s first rate cut from June to July, with the probability of a June cut dropping below 50%. The 2-year U.S. Treasury yield surged to a one-week high of 3.55%, directly suppressing valuations of all zero-yield assets. Bitcoin, which pays no interest and provides no cash flow, faces sharply increased opportunity costs when risk-free yields (U.S. Treasuries) strengthen—this is the most fundamental and hardest-to-refute logic behind employment data threatening Bitcoin.

2026 March Fed rate cut probability. Source: CME FedWatch

Immediate Market Response: Bitcoin Tests $67,000, Ethereum Also Under Pressure

Macroeconomic headwinds do not discriminate across asset classes. According to the latest data from Gate as of February 12, 2026:

• Bitcoin (BTC) is priced at $67,425.1 today, with a 24-hour trading volume of $1.07 billion, market cap of $1.38 trillion, and market share of 55.93%.
• BTC price changed -0.94% in the past 24 hours, with a total decline of -11.59% over the past 7 days, and -23.78% over the past 30 days.
• Ethereum (ETH) is priced at $1,959.69 today, down -2.02% in 24 hours, with a 30-day decline of -32.22%.

From a capital flow perspective, U.S. spot BTC ETFs have been experiencing net outflows for several days, reflecting increased institutional risk aversion following the non-farm payroll data. Market sentiment has shifted from cautious optimism to defensive waiting.

Recently, Bitcoin has been oscillating between $65,000 and $69,000. After the payroll data release, it briefly touched a 24-hour low of $65,754.9 before rebounding slightly to $67,425.1. This price level is below most institutional cost bases since the start of the year, indicating short-term selling pressure still needs time to digest.

Yield as an “Invisible Shackles”: Why Bitcoin Is So Sensitive to U.S. Treasuries

Many investors wonder: Bitcoin claims to be “digital gold,” so why can’t it escape Wall Street’s interest rate framework?

The answer lies in a fundamental change in pricing models. From 2024 to 2025, the structure of Bitcoin market participants has undergone a qualitative shift: institutions are entering en masse via ETFs, hedging funds are engaging in basis trading, and listed companies are incorporating BTC into treasury strategies. These funds are highly sensitive to capital costs.

Bank of America strategist Michael Hartnett recently warned that the key support level for Bitcoin as a bubble asset is $58,000. In other words, if the Fed maintains a higher-for-longer stance, Bitcoin will continue testing its lows in a tightening liquidity environment.

Cleveland Fed President Beth Hammack explicitly stated that current monetary policy is in a good position, and interest rates may remain unchanged for quite some time. This undoubtedly dampens market expectations for a summer rate cut.

The 10-year Treasury yield jumped to around 4.2% after the non-farm data, marking the largest single-day increase in a month. For crypto markets with significant leverage, this means higher financing costs and compressed arbitrage opportunities, forcing institutions to reduce positions to balance risk exposure.

Mid- to Long-Term Outlook: Rate Cuts Will Be Late but Not Absent

Despite the short-term pressure, we need to clarify a key question: does this batch of non-farm data fundamentally destroy the rate cut path? The answer is no.

First, although January’s data was strong, the Bureau of Labor Statistics also revised down employment figures for the past year, indicating the market is not overheating—just resilient. Second, inflation remains the main concern for the Fed—if next week’s CPI data shows signs of slowing, market expectations for rate cuts could quickly rebound.

According to Gate’s 2026 Bitcoin price forecast model, the market still prices in a range of volatility for the year:

• Predicted average price for 2026: $69,065
• Yearly price range: $61,468 – $98,763

This suggests that if macro pressures push BTC toward the lower end of the range in the short term, it could instead become a starting point for long-term capital reallocation.

Ethereum faces a similar valuation restructuring. Based on Gate data, the 2026 ETH average forecast price is $2,095.27, with a volatility range between $1,320.02 and $2,283.84. The macro liquidity tightening’s impact on high-beta assets is more pronounced, as evidenced by ETH/BTC’s recent continued weakening.

Institutional views are not entirely bearish. 21Shares analyst noted that strong employment data delays rate cuts, but if subsequent economic slowdown signals emerge, the Fed would have ample reason to shift toward easing in the second half of the year. At that point, Bitcoin’s limited supply will once again be a key narrative of scarcity.

Market Structure Amplifies Macro Pressure: Leverage and ETF Flows as a Double-Edged Sword

The destructive power of non-farm data stems not only from interest rates themselves but also from the fragile market structure. Over the past three months, perpetual contract funding rates for Bitcoin have mostly remained positive, accumulating significant long leverage. When macro sentiment shifts, these leveraged positions are forced to close, creating a negative spiral of falling prices and margin calls.

Meanwhile, the dual channels of spot ETFs can also amplify selling pressure during increased volatility. Facing rising yields, institutional investors tend to reduce equity exposure, making BTC ETFs one of the most liquid tools for liquidation. Over the past week, U.S. spot BTC ETFs experienced net outflows exceeding $800 million, coinciding closely with the non-farm payroll release. This is not unique to Bitcoin but a common fate for all risk assets during liquidity contractions.

Conclusion: Macro Headwinds Persist, but Don’t Underestimate Liquidity Resilience

U.S. employment data has indeed created short-term trouble for Bitcoin. It delayed rate cut expectations, pushed up risk-free yields, and tested market risk appetite.

However, extending the timeline to 12–18 months, the Fed’s policy pendulum will eventually swing. U.S. Treasury interest payments have already reached an annualized $1 trillion, and debt pressures will force monetary policy compromises. At that point, Bitcoin’s fixed supply and the wave of global liquidity easing will once again fuel a major price rally.

The current threats are real but not fatal. For investors, understanding how employment data influences unemployment and, in turn, shapes the Fed’s rate decisions is no longer academic theory but a vital survival skill for Bitcoin trading in 2026.

The rhythm of macro data is unpredictable, but the direction of the cycle remains clear. In a liquidity winter, maintaining discipline and positions is key to riding the wave when spring arrives.