Bitcoin traded near the $70,000 threshold on Thursday as investors grew more cautious following another surge in oil prices driven by the intensifying conflict in the Middle East.
The world’s largest cryptocurrency was last trading 0.23 percent lower at $70,034 as of 1:24 GMT.
Bitcoin appears to be stabilizing around the $70,000 level as markets absorb the latest geopolitical developments.
Energy surge complicates Fed’s trajectory toward rate cuts
Oil markets remained the primary driver of risk sentiment. Brent crude climbed back above $100 per barrel after pulling back from Monday’s surge toward $120, which marked its highest level in nearly two years.
The latest escalation in the Middle East involved attacks on two fuel tankers in Iraqi territorial waters and strikes targeting commercial vessels transiting the Strait of Hormuz, a crucial artery for global oil trade. Roughly one-fifth of the world’s oil supply moves through the Strait of Hormuz, and tanker traffic has slowed sharply as security risks intensify.
The jump in energy prices has reignited concerns about global inflation at a time when central banks had been edging toward policy easing. Analysts warn that oil prices remaining above $100 could complicate the U.S. Federal Reserve’s trajectory toward rate cuts and place additional pressure on risk-sensitive assets like Bitcoin and other cryptocurrencies.
Read: Ether, Solana and XRP surge as Trump signals de-escalation in Middle East
Markets eye key inflation data
In recent months, Bitcoin has tended to move alongside broader risk assets, with traders increasingly cautious that a renewed inflation shock could tighten liquidity conditions. Investors are also looking ahead to key U.S. economic data for further signals on the Federal Reserve’s policy outlook.
Weekly jobless claims are set for release later Thursday, while the U.S. Personal Consumption Expenditures (PCE) price index, the Fed’s preferred inflation gauge, is due on Friday.
As Bitcoin declined, the broader crypto market saw mixed movement. The world’s second-largest cryptocurrency, Ethereum, edged up 0.25 percent to $2,055.80.
XRP, the third-largest crypto token, declined 0.59 percent to $1.3841. Solana gained 1.11 percent, while Cardano slipped 0.38 percent and Polygon rose 0.42 percent.
Among meme coins, Dogecoin rose 1.44 percent.
