Bitcoin declined during Asian trading on Friday but managed to stay above the key $70,000 support level, as investors remained cautious amid escalating tensions in the Middle East. Rising geopolitical risks pushed oil prices higher and added uncertainty to the outlook for global inflation and interest rates.
The world’s largest cryptocurrency was down about 3.1% to $70,182.6 as of 00:56 ET (05:56 GMT). Earlier in the week, Bitcoin briefly climbed above $74,000, leaving it still on track to post a weekly gain of around 7% despite Friday’s pullback.
Iran conflict and oil prices in focus
Market sentiment across crypto remained fragile as geopolitical tensions intensified. U.S. and Israeli strikes on Iran triggered retaliatory missile and drone attacks across the region, with the conflict entering its seventh day and showing little sign of easing.
The war has also raised concerns about disruptions to shipping through the Strait of Hormuz, a vital global energy corridor responsible for transporting roughly 20% of the world’s oil supply. Any disruption to this route could have major consequences for global energy markets.
Oil prices have surged sharply since the conflict escalated, climbing more than 16% this week as traders price in the possibility of extended supply disruptions if tensions continue.
The spike in crude prices has also reignited fears of persistent global inflation, which could complicate the outlook for central bank policy. Investors are increasingly scaling back expectations for near-term interest rate cuts by the U.S. Federal Reserve, as higher energy costs may keep inflation elevated.
This shift in expectations has strengthened the U.S. dollar, which gained ground during the week and pressured several risk assets. A stronger greenback also weighed on commodities, with gold heading for a weekly decline despite ongoing geopolitical tensions.
Even with the broader risk-off sentiment in global markets, Bitcoin has shown relative strength by holding above the psychologically important $70,000 level, indicating continued investor interest in the cryptocurrency.
Altcoins also move lower
Most major altcoins also declined on Friday as cautious sentiment spread across the crypto market.
Ethereum, the world’s second-largest cryptocurrency, fell about 3% to $2,069.03.
XRP, the third-largest cryptocurrency by market capitalization, dropped 1.8% to $1.39.
Solana slipped 1.6%, while Cardano and Polygon each declined around 2.5%.
Among meme coins, Dogecoin also moved lower, falling approximately 1.8%.
