The cryptocurrency market experienced significant selling pressure as the price of Bitcoin (BTC) was pushed back at the $79,000 resistance level before falling below $76,500. Indirectly, it recorded a 10-day low. This price correction was driven by increased geopolitical tensions following a series of new military strikes between the United States (US) and Iran in the Middle East.
Prior to this decline, Bitcoin managed to record a surge above $81,000 as a result of a surge since mid-August, before momentum stalled following Federal Reserve (Fed) Chairman Kevin Warsh’s hawkish speech in Jackson Hole. Investors’ attempts to push the price back to $79,000 earlier this week failed as reports of new attacks in the Gulf region reduced global risk appetite, dragging the total crypto market capitalization down to $2.6 trillion.
Most large-cap altcoins also fell into the red, with Ethereum falling below $2,400, Solana retreating below $100, and XRP slipping from $1.35. However, a few altcoins bucked the market trend, led by Uniswap (UNI) which surged nearly 10% to above $6.2, while Filecoin (FIL) and BTW recorded double-digit gains.
On the U.S. monetary policy front, New York Fed President John Williams appeared to ease the debt market jitters by insisting that the surge in long-term bond yields reflects strong economic growth rather than inflation panic. He explained that demand for capital to build artificial intelligence (AI) and data center infrastructure is the main engine pushing up borrowing costs.
While acknowledging that the Middle East war and trade tariffs are keeping inflation above the 2% target, Williams insisted that long-term inflation expectations remain contained with no second-round effects. He supported the current monetary policy stance and stressed the need to assess additional economic data before setting a vote at the September FOMC meeting.
