Bitcoin Holds Near $65,000 as Rate Fears Ease
Bitcoin edged lower on Thursday after recovering modestly during recent sessions.
Softer US inflation data reduced concerns that the Federal Reserve could raise interest rates soon. This shift provided some support to Bitcoin and the wider cryptocurrency market.
However, rising tensions between the United States and Iran continued to weaken global risk appetite.
Bitcoin slipped 0.2% to approximately $64,830 in early trading. Despite the decline, the world’s largest cryptocurrency remained about 1.6% higher for the week after rebounding from its lowest levels of the year.
Softer US Inflation Supports Crypto Prices
Bitcoin’s recent recovery followed weaker-than-expected US consumer and producer inflation figures for June.
The data encouraged investors to reduce their expectations for an immediate Federal Reserve rate hike.
Higher interest rates are generally negative for speculative and non-yielding assets such as cryptocurrencies. When rates rise, investors can earn better returns from lower-risk assets, which may reduce demand for Bitcoin.
Therefore, the possibility that the Fed will delay further rate increases offered some relief to the crypto market.
Iran Conflict Raises New Inflation Risks
Despite softer inflation data, investors remained concerned that rising energy prices could push inflation higher again.
The United States and Iran exchanged attacks for a fifth consecutive day, while neither side showed clear signs of moving toward a new peace agreement.
The conflict disrupted oil shipments through the Strait of Hormuz, one of the world’s most important energy transport routes.
The disruption sent oil prices sharply higher and increased fears that energy inflation could return in the coming months.
A sustained rise in oil prices could force central banks to maintain higher interest rates or resume monetary tightening later in the year.
Chip Stock Sell-Off Hurts Market Sentiment
A sharp decline in high-performing semiconductor stocks also kept investors cautious.
Technology and chip shares have benefited heavily from the artificial intelligence investment boom. However, concerns about valuations and the sustainability of AI spending have recently increased market volatility.
The sell-off placed additional pressure on risk-sensitive assets, including cryptocurrencies.
Strategy CEO Defends Bitcoin Treasury Model
Strategy CEO Phong Le said the company remains committed to purchasing Bitcoin over the long term.
During an interview with Bloomberg Television, Le said serious risks to Strategy’s treasury model would only emerge if Bitcoin dropped to between $8,000 and $10,000.
He also stated that his goal is for Strategy to remain the largest buyer of Bitcoin for the foreseeable future.
Strategy’s Bitcoin Sales Raise Investor Concerns
Le’s comments followed reports that Strategy sold more than $215 million worth of Bitcoin earlier this month.
The company also went nearly a month without announcing a new Bitcoin purchase.
These developments raised questions about the sustainability of Strategy’s long-term accumulation strategy.
The company has issued debt and other forms of capital to finance many of its Bitcoin purchases. As a result, investors are closely monitoring its ability to meet rising financial obligations.
Strategy Remains the Largest Corporate Bitcoin Holder
Although the recent sale represented only a small portion of Strategy’s total Bitcoin holdings, continued selling could become a significant market risk.
Strategy remains the world’s largest corporate holder of Bitcoin. Therefore, sustained reductions in its treasury could place considerable downward pressure on the cryptocurrency’s price.
The company’s large position means that any change in its buying or selling strategy is closely watched by crypto investors.
Ether Leads Modest Altcoin Gains
Broader cryptocurrency prices moved slightly higher, although gains remained limited due to a lack of strong positive catalysts.
Ether, the world’s second-largest cryptocurrency, rose 2.3% to approximately $1,926.
XRP gained around 0.9%, while Cardano and BNB recorded smaller increases.
Solana moved against the wider trend and fell approximately 1.2%.
Meanwhile, Dogecoin and the Official Trump token each moved by less than 1%.
