Bitcoin Sinks Below $77,000 After Donald Trump Threatens Iran With Military Action

Bitcoin sank under $77,000 late Sunday after a fresh threat from U.S. President Donald Trump against Iran rattled investors and renewed inflation worries.

“If new Federal Reserve Chair Kevin Warsh is still itching for a "good family fight" over monetary policy, he is likely to get one if he sticks to his guns on interest rate cuts”

CNBC

The largest cryptocurrency traded at $76,691 by 11:10 p.m. ET on Sunday, down 1.2% on the day, after printing a low near $76,520 earlier in the session.

CNBC

The decline followed a Truth Social post in which Trump warned that further delays in a peace deal would invite military action, writing, "They better get moving, FAST, or there won't be anything left of them,".

Brent crude climbed 1.78% to $111.20, and WTI advanced 2.2% to $107.70 as traders braced for a wider Middle East escalation, while the Crypto Fear & Greed Index slid to 27 from a neutral 40 to 50 range a week earlier.

Kevin Warsh comes into the Fed facing a big "family fight" over cutting interest rates as inflation spiking and Treasury yields surging leave the Federal Open Market Committee in no mood to ease.

Former Cleveland Fed President Loretta Mester said, "I just don't think right now he can make those arguments in a credible way, because we have an inflation problem," pointing to inflation as Warsh's first and primary policy challenge.

Cointelegraph

At the most recent meeting in late April, three FOMC members voted against the policy statement, homing in on one sentence investors took as implying the next move would be a cut.

Lou Crandall, chief economist at Wrightson ICAP, said, "Family fights generally lead to constructive outcomes," while also arguing that Warsh could present any shift as a more agnostic communications framework.

Prediction market platforms like Kalshi are offering users 38.2% chances on event contracts betting that the Fed will lower interest rates before 2027, dropping from 96% in February.

CME FedWatch shows a 98.8% probability that the Fed would not change its interest rates, currently at 3.50% to 3.75%, until the end of June, with a more than 94% chance of the same through July.

With Warsh expected to assume his role as Fed chair on Friday, Kalshi and CME FedWatch both frame a near-term pause, while the next Federal Open Market Committee meeting is scheduled for June 16.

At Warsh’s confirmation hearing, Massachusetts Senator Elizabeth Warren said confirming him could result in the Fed "granting special accounts to [the Trump family’s] crypto company or bailouts to his friends on Wall Street if they get into trouble," as Warsh disclosed more than $100 million in assets ahead of the April hearing.