as a sharp rise in yields and ongoing tensions between the U.S. and Iran kept investors away from risk assets.

The world's largest cryptocurrency rose 1.3% to $84,506 by 4:25 p.m. Moscow time. Over the weekend, it had climbed to $85,000 but quickly reversed course.

Markets were somewhat buoyed by Wall Street giant Citi expanding its digital asset services in Japan and the UAE, amid hopes for broader adoption of traditional financial instruments.

**Yields and Iran Tensions Weigh on Bitcoin**

Cryptocurrency markets were rattled by an overnight surge in Treasury yields, as markets continued to price in expectations of further interest rate hikes by the Federal Reserve.

Key employment data due this week is expected to provide further signals regarding rates, with any signs of resilience in the U.S. labor market reinforcing the case for further rate hikes.

The yield on benchmark 10-year Treasury notes jumped to a 19-year high in September after the Fed raised rates by 25 basis points and issued a hawkish outlook amid persistent inflation.

Adding to inflation concerns, oil prices surged this week amid little progress in negotiations between the U.S. and Iran. On Monday, President Donald Trump denied reports that he had offered Iran some concessions in exchange for guarantees regarding the Strait of Hormuz and its nuclear ambitions. Trump previously rejected Iran's latest peace proposal.

Tensions between Saudi Arabia and the Houthis persisted, keeping markets on edge over potential further disruptions to oil supplies and dampening appetite for risk assets.

Higher interest rates weigh on speculative assets like cryptocurrency, as they increase the opportunity cost of investing in this sector compared to debt securities.

Tether’s USDT linked to Iranian finance — Senate report

Tether’s USDT stablecoin has become a "significant financial lifeline" for Iran and a means of funding proxy groups such as Hezbollah, according to a report by Senate Democrats released on Monday.

The report was prepared by Senator Richard Blumenthal of Connecticut, the top Democrat on the Senate Permanent Subcommittee on Investigations. It examined 846 Iran-linked crypto wallets that had been sanctioned by Israel and the US.

It found that 84% of the wallets conducted transactions in USDT, including activities to help the Iranian government move funds across borders and prop up its currency amidst US sanctions—including through the Central Bank of Iran.

USDT is the world's largest dollar-backed stablecoin and has previously faced scrutiny regarding potential transactions involving entities under US sanctions.

Cryptocurrency prices today: Altcoins rise

The broader cryptocurrency market saw cautious gains on Tuesday, recovering somewhat from weekend losses. Ether, the world's second-largest cryptocurrency, rose 1.85% to $2,737, while XRP gained 1.67%.

Solana rose 1.6%, while BNB remained virtually unchanged. Cardano rose 1.3%.