Bitcoin Slumps on Waning Demand and Rising Inflation Concerns

Bitcoin (BTC) has been struggling lately as demand appears to be waning. The BTC/USD pair fell for four consecutive days and reached its lowest level since August 4, trading at 63,515.

Data shows that Bitcoin's futures open interest has dropped in the past few days, a sign of stalled activity in the futures market. Additionally, Bitcoin ETFs have lost momentum after adding over $800 billion in assets last week as investors shifted to a risk-off sentiment amid the ongoing US-Iran crisis.

The ongoing war is causing concerns that it will push inflation higher, prompting the Federal Reserve to hike interest rates either this year or in 2027. Bitcoin tends to underperform when the Fed is hiking interest rates.

Companies such as Strategy and mining firms like MARA and Riot Platforms have been selling their coins to boost their cash reserves, pivoting to the booming data center business.