Bitcoin fell below $63,000 on Friday as renewed US-Iran tensions and concerns about higher interest rates weakened demand for cryptocurrencies and other risk-sensitive assets.
The decline erased much of Bitcoin’s brief recovery earlier in the week and pushed the world’s largest cryptocurrency back into negative territory over the past seven days.
Bitcoin Price Falls Below $63,000
Bitcoin dropped 2.4% to approximately $62,878 by 9:30 a.m. ET.
The cryptocurrency was heading for a weekly loss of around 1.4% after its recent rebound lost momentum.
Investors moved away from speculative assets as geopolitical risks increased and Federal Reserve officials warned that interest rates could remain elevated or move even higher.
Federal Reserve Comments Pressure Crypto Markets
Softer US inflation data had initially reduced fears of an immediate interest rate increase.
However, several Federal Reserve officials later adopted a more hawkish tone.
Dallas Fed President Lorie Logan said interest rates may need to rise further if inflation remains persistent. Governor Christopher Waller had issued a similar warning.
Fed Chair Kevin Warsh also repeated the central bank’s commitment to returning annual inflation to its 2% target. However, he did not provide specific details about the policy measures that could be required.
Higher Rates Create Problems for Bitcoin
Higher interest rates are generally negative for non-yielding and speculative assets such as Bitcoin.
When bond yields and savings rates increase, investors can earn stronger returns from lower-risk assets. This raises the opportunity cost of holding cryptocurrencies.
As a result, expectations for tighter monetary policy can reduce demand for Bitcoin and other digital assets.
Bitcoin has struggled since the US-Iran conflict began in February and has fallen by approximately 28% since the start of 2026.
Rising Oil Prices Add to Inflation Concerns
A sharp increase in oil prices added to concerns that inflation could remain elevated for longer.
Energy markets rose as military activity between the United States and Iran intensified near the Strait of Hormuz.
Reports also indicated that Tehran could threaten other major shipping routes across the Middle East.
Any wider disruption to energy transportation could push oil and fuel prices higher, adding further pressure to global inflation.
US-Iran Conflict Weakens Risk Appetite
The worsening conflict has encouraged investors to reduce exposure to volatile assets.
Bitcoin is sometimes presented as a safe-haven alternative to traditional currencies. However, during periods of immediate market stress, it often trades in line with technology stocks and other risk-driven investments.
The latest sell-off suggests traders remain more focused on Bitcoin’s speculative characteristics than its potential role as a geopolitical hedge.
Bitcoin ETF Outflows Return
US spot Bitcoin exchange-traded funds were heading for modest net outflows during the week.
Data from SoSoValue indicated that the funds were on track to lose approximately $56.6 million.
That followed inflows of $197.4 million during the previous week, which had ended an eight-week run of substantial withdrawals.
The renewed outflows suggest institutional demand remains fragile despite the temporary improvement recorded one week earlier.
Crypto.com Raises $400 Million
Elsewhere in the cryptocurrency industry, Crypto.com raised $400 million from market-making firm Citadel Securities.
The transaction valued the crypto exchange at approximately $20 billion and represented its first institutional fundraising round.
Citadel Securities is one of the world’s largest market makers and provides liquidity across several financial asset classes.
Jim Esposito, president of Citadel Securities, said the growing connection between traditional finance and digital-asset infrastructure could improve market efficiency.
Crypto.com Plans Expansion Into New Markets
Crypto.com said it intends to use the new funding to expand beyond its existing cryptocurrency services.
The company plans to develop products involving tokenised securities, derivatives and other financial assets.
The investment highlights continued institutional interest in crypto infrastructure, even as digital-asset prices remain under pressure.
Ethereum and Altcoins Decline
The wider cryptocurrency market also moved lower on Friday.
Ether fell 3.4% to approximately $1,817, while XRP declined 3.2% to around $1.07.
Solana, Cardano and BNB each lost roughly 3.3%.
The broad decline showed that selling pressure was not limited to Bitcoin.
Memecoins Join the Sell-Off
Memecoins also weakened as investors reduced exposure to higher-risk tokens.
Dogecoin and the TRUMP token both declined by approximately 3%.
These assets often experience larger price swings during periods of market uncertainty because their valuations are heavily influenced by sentiment and speculative trading.
Bitcoin Outlook Remains Uncertain
Bitcoin’s next move may depend on developments in the Middle East, oil prices and signals from the Federal Reserve.
A reduction in geopolitical tensions or softer monetary-policy expectations could help restore demand for cryptocurrencies.
However, further escalation between the United States and Iran, rising energy prices or renewed rate-hike fears could place additional pressure on Bitcoin and the broader crypto market.
