Bitcoin has fallen back toward $65,000 as investors reduce their exposure to risk assets amidst escalating tensions in the Middle East. This situation has kept oil prices elevated, pushed Treasury yields to their highest levels in months, and strengthened the dollar. According to data from CryptoSlate, BTC experienced a nearly 5% drop, reaching around $66,484, marking its lowest price since the beginning of the month. Analysts suggest that Bitcoin is now acting as a reflector of liquidity structure, with price action confined within a broad range of $65,000 to $72,000. The $65,000 region is seeing passive demand accumulation, while supply remains overhead above $70,000.
The current decline in Bitcoin’s price is not attributed to a crypto-specific shock but rather linked to geopolitical tensions affecting the global market. President Donald Trump announced a delay in plans to attack Iran’s energy infrastructure, extending the deadline to April 6. This announcement has rattled global markets, causing Brent crude prices to rise toward $110 per barrel and the US 10-year Treasury yield to climb to 4.456%, its highest since July. The Nasdaq has also remained in correction territory, having fallen 11% from its recent high.
As the dollar seeks safety, it is on track for its strongest month since July 2025. This environment suggests that Bitcoin is trading more like a high-beta risk asset rather than a hedge against geopolitical stress. Rising oil prices signal not only geopolitical danger but also inflation concerns, which could lead to fewer rate cuts and a challenging backdrop for richly valued assets. Analysts note that when oil prices surge, Bitcoin tends to decline alongside technology stocks rather than rise with gold or other defensive assets.
Market analysts emphasize that the macro backdrop, characterized by high oil prices and rising yields, is hostile for Bitcoin. The dollar’s strong performance this month has added to this strain, with the dollar index set for a 2.4% monthly gain. This tightening of global financial conditions makes speculative trades less attractive, leaving Bitcoin exposed to broader market fluctuations.
The post-ETF market for Bitcoin also appears to require steady institutional inflows to absorb selling pressure. Although US spot Bitcoin ETFs have not lost all demand, the flow pattern has become uneven as macro conditions have worsened. Recent data indicates that these funds experienced significant net outflows compared to earlier inflows, highlighting a market where institutional demand is no longer consistent.
The selloff on Friday coincided with one of the year’s largest derivatives events, with approximately $13 billion in Bitcoin options set to expire. This expiration could lead to sharper price swings as traders adjust their positions. Despite the volatility, Bitcoin’s trading activity remains relatively low, indicating a lack of market confidence.
