Bitcoin (BTC) fell about 3%, slipping below $71,000 into Sunday’s weekly close after talks to end the US-Iran war broke down.
Key points:
– Bitcoin lost gains after negotiations between the US and Iran collapsed.
– The Strait of Hormuz resurfaced as a flashpoint after President Donald Trump demanded it be reopened.
– BTC downside penalized late long positions.
BTC price drops on US-Iran war fears
TradingView data showed BTC dipping under $71,000 following reports that negotiations between US and Iranian delegations in Islamabad ended abruptly. The talks reportedly stalled over nuclear weapons, with both sides leaving without an agreement.
Afterwards, President Trump said the US would blockade the Strait of Hormuz and “interdict” vessels paying Iran for safe passage, posting on Truth Social that “no one who pays an illegal toll will have safe passage on the high seas.” A follow-up post reiterated demands that Hormuz be fully operational as an oil transit route.
Market observers flagged the wider economic risks. The Kobeissi Letter warned that if the conflict escalates or the Strait remains closed, US inflation could rise markedly — noting that US CPI had recently jumped from 2.4% to 3.3% and could climb above 4.0% under further escalation. The analysis highlighted CPI’s sensitivity to oil prices; March’s CPI came in slightly below expectations despite a record jump in its oil-price component.
Kobeissi also said Iranian media reported there were no plans for further talks, asking whether the US would pursue diplomacy or intensify military action.
Bitcoin liquidations mount as longs suffer
Because crypto trades 24/7, Bitcoin reacted to the developing geopolitical chaos in real time. CoinGlass data showed BTC/USD slicing through long positions, with roughly $350 million in liquidations over the prior 24 hours.
“Volatility remains high and it’s clear that there won’t be a path forward where risk-on assets will do well if this continues to be the consensus,” trader Michaël van de Poppe wrote on X, adding that renewed war-driven economic weakness could compel the Federal Reserve to inject liquidity despite rising inflation. He argued the Fed might have “no other option than to start printing again” to support the economy.
Cointelegraph has previously reported rising recession odds for the US in 2026. Market participants will watch next week’s March Producer Price Index print and comments from several senior Fed officials for further signals on inflation and policy.
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