Bitcoin slides 3% to $63,900 as hawkish Fed offsets Iran deal relief

Bitcoin fell 3% to $63,900 as the Federal Reserve's hawkish hold under Chair Kevin Warsh tightened financial conditions, overriding the relief from a signed US-Iran peace deal that lifted stocks.

"The Fed's updated projections show policymakers now see rates ending 2026 at 3.8%, up from 3.4% in March, with nine of 18 officials penciling in a hike this year," Gerry O'Shea, head of global market insights at Hashdex, said. "That kills the rate-cut narrative crypto was counting on."

The selling was broad. Ether fell 3.4% to $1,733, XRP dropped 3.9% to $1.17 and Solana lost 3.6% to $71, CoinDesk data show. Spot bitcoin ETFs lost $82 million and ether funds shed $29 million on Wednesday, with even BlackRock's IBIT posting $31 million in outflows, per SoSoValue. The CoinDesk 20 index, a broad crypto benchmark, fell 1.3%.

Analysts expect bitcoin to trade between $60,000 and $70,000 absent a major catalyst, O'Shea said, naming the CLARITY Act's signing or further US-Iran de-escalation as potential triggers. The next test comes June 26, when $10.6 billion in bitcoin options expire on Deribit — 80% of which are currently out of the money, with max pain at $74,000.

Whales Buy as ETFs Sell

The divergence between institutional and whale flows is widening. Addresses holding 1,000 or more bitcoin now control about 7.17 million coins, their highest since March 14, according to Santiment. Exchange reserves have fallen roughly 80,000 BTC since February as coins move into cold storage.

The accumulation contrasts with Wednesday's ETF outflows. The $82 million bitcoin fund exodus was broad-based, with ARKB losing $44 million and IBIT shedding $31 million, SoSoValue data show. Every ether fund finished in the red, contributing $29 million in combined outflows.

Derivatives Signal Weekend Caution

Bitcoin's options market on Deribit shows whale-sized buying of put options at the $62,000 strike expiring June 21, with 1,750 contracts hitting the tape and buyers paying over $600,000 in premium, Laevitas data show. The positioning suggests traders are hedging against a weekend slide below $62,000.

The put-to-call ratio for the June 26 quarterly expiry stands at 0.87, with $450 million in open interest concentrated at the $60,000 put strike as key support and $406 million at the $80,000 call as the major upside hurdle.

What's at Stake

The macro backdrop has flipped in a matter of days. The Iran peace deal that drove a recovery rally eased oil-driven inflation fears, but a Fed now leaning toward hikes has replaced the cut bets crypto was relying on. Markets put the odds of a rate increase as soon as October near 60%, according to fed funds futures.

For bitcoin, the path forward depends on whether the ETF bid returns and whether the October hike odds recede. Until then, the $60,000 to $70,000 range holds.

This article is for informational purposes only and does not constitute investment advice.