Bitcoin price drops below $66k as Iran, bonds and a hawkish Fed trigger risk-off

Bitcoin price has fallen below $66,000, and altcoins are seeing double-digit losses as markets enter a broad “risk-off” phase. The article highlights three main drivers behind the crypto selloff. First, geopolitical risk is escalating as the US-Iran conflict deteriorates. Iran’s blockade/pressure around the Strait of Hormuz—an area tied to roughly 20% of global oil and gas transit—kept uncertainty elevated, with more than 20 merchant ships reportedly hit since the month began. Investors typically rotate out of risk assets like Bitcoin toward safer holdings. Second, a bond market crisis is pressuring liquidity. Japan’s 10-year yield jumped to 2.38% (highest since 1999). In the US, the MOVE Index rose to 115.02, signaling higher Treasury volatility. With crude oil above about $107 a barrel, inflation expectations are increasing, pushing yields higher and weighing on crypto valuations. Third, the Fed outlook has turned more hawkish. The market narrative shifted from expected rate cuts to a near-zero cut outlook for 2026, with CME FedWatch pointing to a 48.6% probability of a 2026 hike. Tighter policy raises borrowing costs and reduces liquidity—typically bearish for Bitcoin price. Technically, the article notes that if Bitcoin fails to reclaim $68,000, the next major support is near $62,600. It also flags a “Trump factor” to watch for changes in political rhetoric, which could signal a potential bottom.