bitcoin and the broader cryptocurrency market came under pressure on Tuesday after the United States and Iran traded airstrikes, sending the dollar higher.
BTC, the leading cryptocurrency by market cap, fell to $62,657 in Asian trading hours, down nearly 1% since midnight UTC, according to data from CoinDesk. Ether (ETH), XRP (XRP) and solana (SOL) fell between 1% and 2.3%. WTI crude oil futures rose more than 2% to $72.27, while the dollar index held steady above 101.00, maintaining Tuesday’s gains.
The United States said it launched “powerful strikes” against Iran following attacks on three ships in the Strait of Hormuz, including Qatari and Saudi oil tankers. In response, Iran said it had attacked “85 US military facilities” in retaliation for attacks on its provinces of Hormozgan and Mahshahr.
The magnitude of the escalation appears to have brought the two nations’ ceasefire to the brink of collapse.
The war with Iran broke out in late February, pushing oil prices well above $100 per barrel and generating a massive inflationary shock around the world. While prices have since fallen back below $60, inflation expectations among consumers have continued to rise, fueling fears of interest rate hikes around the world, including the United States.
Higher rates make it harder for traders to abandon supposedly safe bond yields in favor of riskier assets like cryptocurrencies.
