The cryptocurrency market declined Friday afternoon as escalating tensions between Iran and Israel, combined with economic uncertainty and a cautious Federal Reserve, weighed on investor sentiment.
Bitcoin (BTC) is down by nearly 1% on the day to $103,800, while Ethereum (ETH) dropped 3.7% to $2,420. XRP decreased 2% and is changing hands at $2.13. Meanwhile, Solana (SOL) plunged nearly 4% to $140.
The total cryptocurrency market capitalization dropped by 3.3% in the past 24 hours to $3.31 trillion, while leveraged liquidations amounted to $472 million, according to CoinGlass. ETH accounted for $164 million, while BTC followed with nearly $126 million. Altcoins contributed to nearly $49 million in liquidations.
U.S. spot Bitcoin exchange-traded funds (ETFs) recorded $389 million in inflows on June 18. Meanwhile, spot ETH ETFs brought in $19 million, according to SoSoValue data.
Experts say the market drop reflects investor caution amid heightened tensions between Iran and Israel, as well as the Federal Reserve’s recent decision to hold interest rates steady while waiting for clearer macroeconomic signals.
The Fed decided earlier this week to hold interest rates steady at 4.25%–4.50%, as expected. And earlier today, the central bank released its semiannual Monetary Policy Report to Congress, reinforcing a wait-and-see approach.
The report noted that inflation remains somewhat elevated and emphasized ongoing uncertainty around the impact of President Donald Trump’s tariffs.
"The effects on U.S. consumer prices of the increase in import tariffs this year are highly uncertain, as trade policy continues to evolve, and it is still early to assess how consumers and firms will respond," reads the report.
"Although the effects of tariffs cannot be observed directly in the official consumer price statistics, the pattern of net price changes among goods categories this year suggests that tariffs may have contributed to the recent upturn in goods inflation,” it added.
