As of Friday morning, news of an Israeli attack on Iran triggered a wave of selling in the cryptocurrency market. The price of Bitcoin fell by 5% to below $104,000. Alternative coins lost between 6% and 9%. According to Coinglass, liquidations led to losses exceeding $1 billion, including long-term investments.
Escalating tensions shake global markets
Market analysts say the strike has spurred interest in safe assets. S&P 500 futures fell by 1.9% as oil and gold prices surged significantly. West Texas Intermediate crude rose by more than 12% to reach $77 per barrel. Gold prices exceeded $3,400 per ounce as investors sought safe havens.
Former BitMEX CEO Arthur Hayes predicted volatility in the cryptocurrency market. He wrote after the incident: "Prepare yourselves well, pessimists." He added that the tariffs proposed by U.S. President Donald Trump heightened the risk. The price of Ethereum dropped by 8% to $2,505, a critical support level. Other cryptocurrencies also fell by 10% within hours.
Reports indicate that gold and oil were unaffected by the decline. Analysts believe that oil prices have risen by 30% from their lows in May. Those betting on falling inflation or an early rate cut may be mistaken. The rise in gold signals concern among many about the future. Some expect this rise to temper as tensions ease.
The future of cryptocurrencies
Short-term expectations vary. As the news fades, some traders anticipate a rebound from this hasty response. Others say that the U.S. Consumer Price Index number, set to be released later this week, may prompt another shift. If inflation data comes in lower than expected, it could boost sales or ease concerns.
Volatility has returned with a vengeance. Markets were already on edge due to rising interest rates and geopolitical disputes in recent weeks. With attention shifting back to the Middle East front, significant volatility may continue. Analysts say that the price of Bitcoin could drop below $95,000 if the selling continues.
A significant $1 billion liquidation wave. However, the speed of the move may lead traders to anticipate a quick recovery. The hours and days ahead will focus on safe-haven assets, U.S. economic data, and tensions between Iran and Israel $BTC
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