Cryptocurrencies and broader financial markets faced significant declines on Monday amid escalating tensions between the U.S. and Iran. President Trump threatened military action if Iran does not open the Strait of Hormuz, a critical oil shipping route, prompting fears of supply disruptions. Bitcoin (BTC) fell 1.8% to $68,160, with a notable $336.3 million wiped from the crypto market as sentiment remains low, reflected in the Fear and Greed Index.

The volatility in oil prices, which briefly hit over $100 a barrel before settling around $99.30, is raising inflation concerns and increasing the likelihood of a Federal Reserve rate hike, now estimated at 12.4%. Analysts suggest that the performance of cryptocurrencies is closely tied to these geopolitical developments and macroeconomic shifts, with Bitcoin’s support levels at $68,000 and $65,800 being crucial for future price movements.

Market professionals should monitor the evolving situation in Iran, as a de-escalation could lead to a rapid recovery in risk assets like Bitcoin, which remains supported by strong institutional inflows despite the current bearish sentiment.

Source: cointelegraph.com