Ethereum (ETH), Solana (SOL), and other major altcoins are under renewed selling pressure amid mounting geopolitical uncertainty, as U.S. officials reportedly consider direct military action against Iran. Fears of escalation are pushing traders into stablecoins and Bitcoin, leaving high-beta assets like altcoins exposed to sharp downside.
Altcoins Drop as Risk Appetite Evaporates
On Thursday, key altcoins posted notable losses:
- XRP: Down over 1%, trading at $2.17
- Cardano (ADA): Fell to $0.6025, also off more than 1%
- Solana (SOL): Dipped below $146.13, continuing its retracement
- Ethereum (ETH): Dropped 0.7%, reversing its early-week gains
- Dogecoin (DOGE): Flat intraday but down over 10% for the week
This weakness underscores a broad altcoin rotation as investors reduce exposure to higher-risk digital assets in the face of rising macroeconomic and geopolitical risks.
Bitcoin ETFs Attract Capital as Fear Spikes
In contrast to altcoin outflows, Bitcoin ETFs saw $389 million in new inflows on Wednesday, reflecting a flight to perceived crypto safety. Spot ETH ETFs also recorded $19 million in inflows, but the overall trend shows investors are favoring Bitcoin as a haven over riskier alternatives.
The move mirrors historical behavior: during geopolitical crises, Bitcoin tends to stabilize while altcoins underperform due to liquidity drain and volatility spikes.
Fed Signals Sticky Inflation, Raising Market Anxiety
Investor jitters are further amplified by the Federal Reserve’s latest policy stance. Although interest rates were left unchanged, Fed Chair Jerome Powell emphasized that inflation remains “more persistent” than expected, citing risks from tariffs, global conflict, and elevated input costs.
“Tariffs will fall on the end consumer,” Powell warned. “We need to see more before we’re comfortable cutting rates.”
Markets interpreted the Fed’s cautious tone as a sign of prolonged monetary tightening, which typically weighs on both equities and crypto.
Bitcoin Remains Rangebound, Lacks Clear Direction
While Bitcoin (BTC) has gained 13% year-to-date, it has remained rangebound this week, struggling to break decisively higher or act as a clear safe-haven asset. Analysts describe its recent behavior as indecisive:
“Bitcoin seems stuck between two worlds,” said FxPro’s Alex Kuptsikevich. “It’s not reacting to rising risk appetite, nor surging like gold during heightened conflict.”
Outlook: Continued Volatility Likely
With global tensions rising and the Fed offering little relief, altcoins could face further downside pressure, especially if capital continues to consolidate in Bitcoin and stablecoins. Short-term relief may depend on geopolitical de-escalation or stronger macro signals.
Until then, traders may favor defensive crypto positioning, with risk-off sentiment dominating across altcoin markets.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.