Bitcoin edged lower on Monday after trading in a narrow range over the weekend, as investors remained cautious amid escalating U.S.-Iran tensions and the prospect of higher interest rates, dampening appetite for cryptocurrencies.
The world’s largest cryptocurrency slipped 0.01 percent to $64,672 by 12:03 GMT, extending its prolonged period of range-bound trading. Market sentiment remained subdued, with Bitcoin continuing to trade roughly 50 percent below its October record high while holding onto steep losses for the year.
Mideast tensions impact risk sentiment
Escalating tensions between the United States and Iran continued to pressure investor sentiment after both countries exchanged fresh strikes over the weekend.
The conflict intensified following the deaths of at least three U.S. service members, prompting Washington to expand the scope of its military operations against Iran. In response, Tehran sustained attacks targeting U.S. bases and neighboring countries.
The geopolitical escalation sent oil prices sharply higher, with disruptions to shipping through the Strait of Hormuz fueling concerns over global energy supplies.
Fed rate hike bets weigh on Bitcoin
Further pressuring Bitcoin, rising crude prices renewed fears of energy-driven inflation, increasing expectations that the Federal Reserve could be forced to tighten monetary policy later this year.
Although the Fed is widely expected to keep interest rates unchanged at its July meeting, investors remain alert for any hawkish guidance after several policymakers recently warned that persistent inflation could warrant further rate hikes.
Higher interest rates typically weigh on non-yielding assets such as Bitcoin and other cryptocurrencies, as they reduce their appeal compared with interest-bearing investments while also pressuring risk appetite across markets.
Broader cryptocurrency markets were mixed on Monday following a subdued weekend session, with most major tokens continuing to track Bitcoin’s weak performance this year.
The world’s second-largest cryptocurrency, Ether, gained 0.68 percent to $1,883.16.
Other major altcoins also traded in negative territory before recovering some losses, with XRP up 0.74 percent and Solana gaining 1.20 percent.
Cardano lost 0.23 percent, while BNB rose 0.42 percent.
Among meme-based tokens, Dogecoin rose 0.45 percent, while $TRUMP declined 3.44 percent.
