Cryptocurrencies experienced a precipitous decline on Wednesday as escalating geopolitical tensions seized investors’ focus following the conclusion of the July Federal Reserve meeting.

Bitcoin (BTC) plummeted to $64,500 from approximately $66,500, where it traded post-Federal Reserve Chair Jerome Powell’s press conference, marking a decline of over 2% within the past 24 hours. Major altcoins, including ether (ETH), solana (SOL), Avalanche’s AVAX (AVAX), and Cardano (ADA), also saw significant drops, while Ripple’s XRP managed to retain some of its earlier gains. The broad-market crypto benchmark CoinDesk 20 Index was 0.8% lower compared to 24 hours ago.

The sell-off coincided with a New York Times report indicating that Iranian leaders had ordered retaliation against Israel for the assassination of Hamas leader Ismail Haniyeh in Tehran, heightening the risk of a broader conflict in the region.

Earlier in the day, the Fed maintained benchmark interest rates and provided little assurance of a widely anticipated rate cut in September. Chair Powell noted that while no definitive decisions regarding a September cut had been made, the “general sense is that we are moving closer” to reducing rates.

Despite the downturn in digital assets, traditional asset classes saw gains throughout the day. The 10-year U.S. bond yields dropped by 10 basis points, gold increased by 1.5% to $2,450, just below its record highs, and WTI crude oil prices surged by 5%. Equities also soared, with the tech-heavy Nasdaq 100 index rebounding by 3% and the S&P 500 closing the session 2.2% higher, driven by chipmaker giant Nvidia’s (NVDA) impressive 12% gains.

Zach Pandl, head of research at Grayscale, commented in an emailed note that the disparity in asset class performance might be attributed to traders’ pre-Fed meeting positioning. “Equities may have been slightly under-owned following the recent drawdown, while bitcoin is coming off a robust period with substantial inflows, whereas gold rallied after a phase of weakness,” he explained.

“In a broader context, the amalgamation of Fed rate cuts, bipartisan attention on crypto policy issues, and the potential for a second Trump Administration could advocate for a weaker U.S. dollar, which should be very positive for bitcoin,” Pandl concluded.