Bitcoin dropped sharply on Thursday, falling more than 4% to settle at $70,817. The decline followed the Federal Reserve’s renewed warnings about elevated inflation and its decision to hold interest rates steady, which appeared to dampen expectations for a near-term policy pivot.
Federal Reserve Maintains Rates, Raises Inflation Outlook
The Federal Reserve updated its 2026 inflation projection to 2.7%, up from 2.4%. Officials stressed that higher energy costs could delay anticipated rate reductions. These developments have put pressure on both cryptocurrency and traditional asset markets, as investors reassess expectations for monetary easing.
Energy sector volatility became a growing focus after Iran launched strikes against Middle Eastern energy infrastructure. Brent crude oil surged to over $115 per barrel as concerns about supply disruptions intensified in response to attacks around Iran’s South Pars natural gas facility. The resulting spike in oil prices fueled a stronger US dollar and higher bond yields, creating an unfavorable climate for risk assets.
Equity And Global Markets React To Volatility
US equity futures slipped on Thursday. Dow Jones Industrial Average futures lost 0.3%, with S&P 500 and Nasdaq 100 futures each down around 0.2%. Both the Dow and S&P 500 notched their lowest closes so far in 2026 during Wednesday’s session. Asian equity markets mirrored these declines, as caution spread across global trading floors.
The Bank of Japan chose to keep its own policy rates unchanged. Bank officials warned that ongoing instability in the Middle East and swings in oil prices could complicate Japan’s inflation outlook. Traders turned to upcoming weekly US jobless claims figures and the Philadelphia Fed Manufacturing Index for further signals about the economy’s direction.
In corporate news, shares of Micron Technology dropped more than 2% after hours, despite strong quarterly revenue growth. Investors also awaited earnings releases from large companies such as Alibaba and FedEx.
Federal Reserve Chair Jerome Powell delivered a message interpreted by investors as signaling limited prospects for rate cuts in the near term, although the Fed left open the possibility of a single reduction later in 2026.
Major Cryptocurrencies Slide, Kraken Delays IPO
Leading digital tokens faced sharp losses alongside Bitcoin’s retreat. Ethereum slid 6% to $2,193. XRP declined 3.5% to $1.47, Solana and Polygon each fell 4%, Cardano was down 6%, and Dogecoin lost 5%.
Kraken, a major US-based cryptocurrency exchange founded in 2011 and known for its large user base and wide selection of digital assets, has postponed its planned initial public offering. The company had confidentially filed documentation with the SEC in November 2024. Kraken cited adverse market conditions as the primary factor behind its decision. Its last reported valuation stood at $20 billion, following an $800 million funding round.
Since late 2025, slumping crypto prices and thin trading volumes have made public markets less attractive for digital asset firms. Kraken indicated it would wait for improved conditions before revisiting its IPO plans.
