Bitcoin retreated sharply on Friday after the latest US employment data showed the labor market remained more resilient than anticipated. The cryptocurrency, which had climbed above $82,000 earlier in the session, dropped below the $80,000 level following the release of the August nonfarm payrolls report.

Stronger Labor Market Data Surprises Markets

The Bureau of Labor Statistics reported that the US economy added 162,000 jobs in August. Economists had expected a gain closer to 55,000 or 56,000. The unemployment rate held steady at 4.1 percent, matching both the previous month and consensus forecasts.

Average hourly earnings increased 0.3 percent from the prior month and 3.1 percent over the past year. The report also included notable upward revisions. July employment, previously reported as a decline of 23,000 jobs, was revised to a gain of 21,000. Combined revisions for June and July added 55,000 jobs.

Job gains were concentrated in specific areas. Food services and drinking places accounted for 59,000 new positions, while local government education added 42,000. Together these two categories represented a substantial share of the overall increase. Employment changed little in several other major sectors, including information, financial activities, and professional services.

Market Reaction Across Assets

Bitcoin fell from levels near $81,600 to approximately $79,200–$79,800 in the minutes after the data release, erasing more than $2,000 from its earlier gains. At one point it traded as low as around $79,150–$79,775. Leveraged long positions faced significant pressure, with roughly $200 million in crypto longs liquidated within an hour of the report.

Major altcoins also declined. Ethereum dropped about 3 percent to near $2,450, XRP fell roughly 3 percent to around $2.40, and Solana declined about 2 percent to approximately $101.

Traditional markets moved in tandem. The 10-year Treasury yield climbed toward 4.80 percent as investors adjusted rate expectations higher. The US dollar strengthened. Gold declined more than 2 percent and silver more than 3 percent, reflecting reduced demand for non-yielding assets when interest-rate expectations rise.

Equity indexes showed a more measured response. The S&P 500 and Dow edged lower in early trading while the Nasdaq remained near flat, indicating investors weighed stronger growth against potential pressure on valuations from higher rates.

Implications for Federal Reserve Policy

The robust employment figures raised the probability of a quarter-point interest-rate increase at the Federal Reserve’s September 15-16 meeting. Market pricing moved the odds of a hike to approximately 59–60 percent, up from levels near 51–52 percent before the report.

Stronger hiring gives policymakers greater flexibility to maintain or raise borrowing costs if inflation remains elevated. Attention now turns to the August consumer price index data scheduled for release on September 11, which will provide additional information ahead of the policy decision.

Bitcoin had shown strength earlier in the day, supported by recent inflows into related investment products. The sudden shift in rate expectations reversed that momentum as traders reassessed the outlook for risk assets in a higher-for-longer interest-rate environment.