Bitcoin is currently under pressure as rising oil prices, driven by global geopolitical tensions, have become one of the main factors influencing its movement.
At the time of writing, Bitcoin is currently at $66,736, down 0.13% since it opened early Friday in Asian trading.
In a situation full of uncertainty, investors tend to avoid risk and shift to safer assets, causing assets like Bitcoin to start losing momentum.
Although it managed to rise to around $72,000 on hopes of a resolution to the conflict, the sentiment was short-lived as concerns over oil supply resurfaced.
When oil prices rise, the impact is not just on the energy sector, but also puts pressure on the entire global economy.
High energy costs push up inflation, making it difficult for central banks like the Federal Reserve to lower interest rates.
In a high interest rate environment, liquidity in the market becomes tighter and investors are more cautious about putting funds into risky assets like crypto.
This situation has triggered what is known as ‘risk-off sentiment’, where investors start selling off holdings in risky assets and opt to store value in more stable instruments.
As a direct result, Bitcoin and the crypto market as a whole are experiencing continued selling pressure.
In fact, some analysts expect that if this situation continues, Bitcoin could potentially fall to around $60,000 before finding a stronger support point.
At the same time, retail investor sentiment is also showing signs of concern.
Many are choosing to take a wait-and-see approach, while the Fear and Greed index reflects the still fragile state of the market.
This uncertainty is adding further pressure to the price, making Bitcoin’s movements more volatile in the short term.
