Crypto liquidations surpass $1.1B as BTC and ETH drop amid Iran-Israel conflict
Gold tops $3,410 and oil jumps 13% as investors flee risky assets
Bitcoin falls 4%, ETH down 9%, S&P 500 futures slide 1.9% amid global market shock
A sudden escalation in the Iran-Israel conflict has sent shockwaves through global financial markets, with the cryptocurrency sector suffering the brunt. Bitcoin and major altcoins fell sharply following Israel’s military strike on Iran early Friday in Asia. The total crypto liquidations surpassed $1.1 billion within hours of the event, with risk-averse sentiment spreading rapidly across investor groups.
Bitcoin and Altcoins Experience Heavy Losses
Bitcoin prices dropped 4%, trading below $103,000 during the early session. Ethereum saw an even steeper decline of 9%, falling to $2,500. Other altcoins registered losses ranging between 5 and 10%. Coinglass data confirmed that long liquidations accounted for over $1 billion of the total $1.14 billion in market exits. Analysts warned that continued selling could force Bitcoin to fill the CME gap near the $92,000 level.
This steep downturn in digital assets coincided with increased demand for traditional safe havens. Gold prices surged past $3,410 per ounce while crude oil jumped over 13%, reaching $77 per barrel. As investors moved to hedge against geopolitical risks, the shift away from crypto became evident in the short term.
Wider Market Reacts to Geopolitical Tensions
The impact was not limited to the digital asset space. The S&P 500 futures experienced a 1.9% decrease which indicated wider financial market turmoil. The growing conflict between Iran and Israel led investors to reevaluate their investments in riskier assets. Iran declared it would take severe actions against Israel’s military operations which raises the probability of ongoing regional turmoil.
Arthur Hayes, the former BitMEX CEO, told market participants to remain calm in response to the crash. He pointed out that this reaction might represent an impulsive knee-jerk response. During a past event when Iran fired missiles toward Israel a comparable market pattern became evident. Bitcoin started by falling but subsequently showed better performance than both gold and oil in subsequent days.
Bitcoin’s Decline Reinforces Gold’s Dominance
Bitcoin critic Peter Schiff pointed to the latest price action to highlight Bitcoin’s continued underperformance against gold. He noted that Bitcoin has fallen more than 15% from its 2021 peak when measured in gold terms. Schiff added that with oil prices rising by 30% since May, expectations for a drop in inflation or Federal Reserve rate cuts may be overly optimistic.
Digital currency investors have begun preparing for upcoming market shifts that will be influenced by new U.S. inflation numbers. Digital asset markets will likely experience sustained pressure due to emerging geopolitical tensions along with macroeconomic instability in the near future.
