Bitcoin fell on Tuesday as investors moved into «risk-off» mode following escalating attacks between the U.S. and Iran. The largest cryptocurrency dropped more than 2% on the day, trading at $77,363 after reaching nearly $81,282 on Friday. The U.S. carried out strikes in response to Iran’s attempt to plant mines in the Strait of Hormuz and an attack on an American military base in Jordan, followed by Iran’s «decisive operation» against U.S. military bases. Rising oil prices weigh on bitcoin because higher energy costs fuel inflation, prompting the Federal Reserve to postpone interest rate cuts. Traders are no longer pricing in any rate cut this year and now expect a hike, while Fed Chair Kevin Warsh said inflation has not come down enough.
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