Bitcoin Momentum Weakens as Rising Real Rates and Thin Inflows Cap Upside

Bitcoin (BTC) has edged about 2% higher this week to trade near $68,489, but underlying market signals suggest the rally may struggle to extend.

Demand-side indicators are showing signs of fatigue. Spot Bitcoin ETF inflows have moderated in recent weeks, pointing to softer institutional engagement, while stablecoin supply growth has stalled—an indication that new capital entering the crypto market remains limited.

Meanwhile, Bitcoin’s supply continues to grow at a steady clip. Since the April 2024 halving, the network has been issuing around 450 BTC per day, based on a block reward of 3.125 BTC generated roughly every 10 minutes. Against this backdrop, demand is no longer comfortably absorbing new issuance.

This shift is reflected in Bitfinex’s absorption-to-emissions ratio (AER), which has fallen sharply from 5.3× in late February to approximately 1.3×. The current reading suggests that demand is only marginally outpacing miner supply, leaving the market in a delicate balance rather than a clear accumulation phase.

Under such conditions, any meaningful upside in price would likely require a sustained return of strong inflows, similar to the surge seen in late 2024 and early 2025.

Compounding the issue is an increasingly restrictive macro backdrop. U.S. real yields, particularly on 10-year Treasury Inflation-Protected Securities (TIPS), have climbed more than 30 basis points since late February, recently touching 2.12%—their highest level since June 2025—before settling near 2.02%.

Higher real yields raise the relative attractiveness of bonds by offering stronger inflation-adjusted returns, thereby increasing the opportunity cost of holding non-yielding assets like Bitcoin. This dynamic typically draws capital away from both speculative assets and alternative stores of value.

Market pricing suggests these pressures may persist. The faster rise in 10-year real yields compared to 5-year yields indicates expectations of tighter financial conditions over a longer horizon.

At the same time, elevated oil prices are adding to the strain by tightening overall financial conditions and weighing on risk sentiment across global markets.

Taken together, subdued inflows, steady supply growth, and rising real yields present a challenging environment for Bitcoin, with further gains likely contingent on improved liquidity and a reversal in macro headwinds.