Bitcoin slips back to $71,000 as geopolitical anxiety over Iran joins with poor U.S. inflation data to pressure risk assets

Bitcoin (BTC $70,458.43) broke its recent calm near $74,000 on Wednesday morning amid escalating geopolitical tensions in Iran and stronger-than-expected U.S. inflation data.

The declines began after U.S. President Donald Trump struck a tough tone on Iran, calling it the “NUMBER ONE STATE SPONSOR OF TERROR” in a series of posts on Truth Social. At the same time, Iran’s state TV reported an attack on part of the South Pars gas field. The news followed reports of Israel killing Iran’s Intelligence Minister Esmail Khatib and the U.S. deploying 5,000-pound bunker-buster bombs targeting missile sites near the Strait of Hormuz, a vital route for global oil shipments.

The developments drove WTI crude from around $92 per barrel overnight to nearly $96. Minutes later, U.S. February Producer Price Index (PPI) data showed headline PPI rising 0.7% versus 0.3% expected, and core PPI up 0.5% versus 0.3% forecast, signaling persistent inflation even before the oil spike.

The combined effect of geopolitical risk and inflation worries pressured risk assets. Bitcoin fell toward $71,000, down roughly 3.5% over 24 hours, while ether (ETH), solana (SOL), and XRP (XRP) saw declines closer to 5%. U.S. equities posted modest losses, with the Nasdaq and S&P 500 down 0.4%, and gold slid 2.5% to $4,885 per ounce.

All eyes now turn to the Federal Reserve, widely expected to hold rates steady. Attention will focus on Chair Jerome Powell’s remarks and how policymakers interpret the mix of growth risks and inflation pressures. Trump renewed calls for rate cuts in a Wednesday post, adding a political layer to the Fed’s guidance.