Bitcoin Rally Cools as Geopolitical and Rate Risks Pressure Markets
Bitcoin (BTC) is up 28% since Aug. 19 but has lost momentum as markets absorb Federal Reserve rate increases and weigh another possible hike in October.
Bitcoin (BTC) has lost momentum after a rapid multiweek advance, with geopolitical uncertainty and expectations for another Federal Reserve rate increase weighing on risk-sensitive markets.
BTC has risen 28% since Aug. 19 but has recently cooled as traders assess fresh macroeconomic risks. U.S. President Trump’s rejection of Iran’s proposal to reopen the Strait of Hormuz has added to uncertainty across markets.
Markets are also continuing to absorb the Federal Reserve’s rate increases while preparing for the possibility of another increase in October. Higher interest rates can weigh on risk-sensitive assets by tightening financial conditions.
Despite the slowdown, Bitcoin remains positioned for what could be its strongest quarterly performance since the fourth quarter of 2024.
