Bitcoin Tumbles Below $65K Post-FOMC as Middle East Tensions Flare

Bitcoin

(BTC)
dropped
to
$64,500
from
around
the
$66,500
level
where
it
traded
following
Federal
Reserve
Chair
Jerome
Powell’s
press
conference,
and
was
down
more
than
2%
over
the
past
24
hours.
Altcoin
majors
including
ether

(ETH),
solana

(SOL),
Avalanche’s
AVAX

(AVAX)
and
Cardano

(ADA)
also
declined,
while
Ripple’s
XRP
saved
some
of
the
gains
from
earlier
today.
The
broad-market
crypto
benchmark

CoinDesk
20
Index
was
0.8%
lower
than
24
hours
ago.

The
sell-off
happened
as
the
New
York
Times

reported
that
Iran’s
leaders
ordered
retaliation
against
Israel
for
killing
Hamas
leader
Ismail
Haniyeh
in
Tehran,
increasing
risks
of
a
broader
conflict
in
the
region.

Earlier
today,
the
Fed
left
benchmark
interest
rates
unchanged
and
gave
little
indication
that
a
widely
expected
rate
cut
in
September
is
guaranteed.
Fed’s
Powell
said
that
while
no
decisions
have
been
made
about
a
September
cut,
the
“broad
sense
is
that
we’re
moving
closer”
to
reducing
rates.

While
digital
assets
suffered
losses,
most
traditional
asset
classes
climbed
higher
during
the
day.
The
10-year
U.S.
bond
yields
fell
10
basis
points,
while
gold
was
up
1.5%
to
$2,450,
slightly
below
its
record-highs
and
WTI
crude
oil
prices
surged
5%.
Equities
also
soared
during
the
day,
with
the
tech-heavy
Nasdaq
100
index
rebounding
3%
and
the
S&P
500
closing
the
session
2.2%
higher,
led
by
chipmaker
giant
Nvidia’s
(NVDA)
12%
gains.

The
differing
performances
between
asset
classes
could
be
due
to
traders’
positioning
prior
to
the
Fed
meeting,
Zach
Pandl,
head
of
research
at
Grayscale,
said
in
an
emailed
note.

“Equities
may
have
been
slightly
under-owned
after
the
recent
drawdown,
while
bitcoin
is
coming
off
a
strong
period
with
solid
inflows,
whereas
gold
rallied
after
a
period
of
weakness,”
he
said.

“Bigger
picture,
the
combination
of
Fed
rate
cuts,
bipartisan
focus
on
crypto
policy
issues,
and
the
prospect
of
a
second
Trump
Administration
may
advocate
for
a
weaker
U.S.
dollar
should
be
considered
very
positive
for
bitcoin,”
he
concluded.

UPDATE
(July
31,
2024,
21:30
UTC):

Adds
Grayscale
commentary.