On October 6, 2023, Israel launched an airstrike on Iran, why is the crypto market again engulfed in 'panic selling'?

At 8 a.m., a shocking piece of news broke the silence: Israel carried out airstrikes on Iran. As soon as the news broke, the financial markets were instantly turbulent, especially in the crypto space, where investors' nerves were tightly wound. Ethereum, the leading cryptocurrency, seemed to touch a high of $2800 at that moment, which then caused an uproar in the market—was this a signal of a peak? Is the crypto market about to face a new wave of a major crash?

In the face of such an unexpected event, many people's first reaction may be panic. After all, military conflicts have always been seen as 'black swans' in financial markets, and the uncertainty they bring is often enough to cause asset prices to fluctuate instantly. However, when we calm down and carefully examine history and reality, we may find that things are not that simple.

Looking back over the past few years, the conflict between Russia and Ukraine has lasted quite a long time. Although there were indeed short-term violent fluctuations in the market at the beginning of the conflict, over time, investors gradually learned how to find balance amid such uncertainties. Similarly, the friction between Israel and Iran is not a new issue. While these conflicts often stir global nerves, in the long river of financial markets, they seem no longer to be 'bombshells' capable of triggering comprehensive turmoil.

So why can the news of Israel's airstrike on Iran still cause a stir in the crypto space? This may be intricately related to the current market background trend. In a bear market, any bad news can become the last straw that breaks the camel's back, triggering a complete market collapse. However, under the current bull market backdrop, the situation is different. Although news of conflict can still trigger short-term market fluctuations, major funds often use such news to manipulate market trends, creating a specific market atmosphere.

In this market atmosphere, many investors are constrained by a kind of inertia thinking. They firmly believe that once the price rises, a significant drop will inevitably follow. This obsession is particularly common in the crypto space, to the point where many people react at the slightest price fluctuation.