Bitcoin dropped below $78,000 to about $77,687 on Monday. This came as investors pulled back from riskier assets in both crypto and global markets after Federal Reserve Chair Kevin Warsh made hawkish comments.
Warsh’s comments raised expectations for more U.S. rate hikes, which boosted the dollar and pushed Treasury yields higher. Now, markets see over a 50% chance of a 25-basis-point hike at the Fed’s September 16 meeting. At least one rate increase by year-end is seen as almost certain, and two hikes are now a strong possibility.
Risk assets are also under pressure due to the escalating tension between the United States and Iran. Concerns about inflation and the direction of international monetary policy grew as Brent crude prices rose beyond $90 per barrel.
The global cryptocurrency market fell 0.6% to $2.6 trillion. This collapse was accompanied by leveraged liquidations that destroyed positions for almost 100,000 dealers, totalling about $400 million.
With net withdrawals of over $201.9 million, U.S. spot Bitcoin ETFs broke a nine-day run of inflows. Still, institutional demand remains strong. Spot Bitcoin ETFs brought in about $2.8 billion in net inflows over the two weeks through August 28. The first week saw $1.92 billion, the highest weekly inflow since early October 2025, followed by another $924.5 million over the next five days.
In a possible bullish sign, Strategy Executive Chairman Michael Saylor posted “We’re Back” on X. This has led to speculation that the company may be preparing for its first Bitcoin purchase since June 22.
Altcoins Under Pressure
Even after rising more than 30% over the previous month, Ethereum was down 1% at $2,437. Last week, net inflows into U.S. spot Ether ETFs reached a record $815.7 million, demonstrating the continued strength of institutional demand. BitMine Immersion Chairman Tom Lee still predicts Ethereum will reach $6,000 by the end of 2026.
BNB dropped 1% to $685, XRP fell 1.6% to $1.37, Solana lost 2.25% to $102, and TRX slipped 1.27% to $0.3364. Hyperliquid’s HYPE fell over 2% to about $81.20, weighed down by a $1.2 billion token unlock.
Even though major tokens were weak, the global crypto market cap rose 0.06% to $2.65 trillion. This suggests the broader market is still fairly resilient.
Outlook
Crypto traders are now watching the Fed’s September policy decision, Treasury yields, the strength of the dollar, and updates on the U.S.-Iran conflict.
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