Bitcoin Drops Below $80k as Fed Rate Hikes and Oil Prices Bite

Bitcoin dropped below $80k on Tuesday as investors weighed the impact of upcoming Federal Reserve rate hikes and rising oil prices.

The world's largest cryptocurrency had touched a three-and-a-half month high last week, reaching $82,178.6 on September 3, but fell 0.9% to $78,533.7 by 16:50 ET (20:50 GMT).

The decline came despite the crypto posting a significant gain in August, largely driven by positive U.S. regulatory developments and a debasement trade sparked by the U.S. Treasury's intervention move to cap rising longer-term yields.

However, Friday's blockbuster jobs report, which showed 162k nonfarm payrolls added in the month, nearly triple of the anticipated 55k figure, dented that momentum. The data pointed to an overheating economy besieged by price pressures and hinted at a highly resilient U.S. labor market.

Market participants reflected those expectations by boosting their odds for a quarter-point rate hike by the Federal Reserve later this month, which currently stood at around 60%, as per the CME FedWatch tool.