Israel responds to Iran: Bitcoin briefly drops below $60,000 again!

Geopolitical tensions in the Middle East have impacted financial markets on Thursday. Israel attacked Iran and, as a result, the prices of Bitcoin and major cryptos plummeted! However, the damage seems to have been contained, allowing for a quick rebound.  

Crypto plunge after the Israeli attack on Iran!

Early this morning, the first reports indicated that the Israeli military had conducted missile strikes against military sites in Iran. While the details remain unclear, this sudden escalation in tensions between the two enemy nations immediately affected the market for Bitcoin and cryptos in general. On one hand, investors rushed to traditional safe-havens such as gold. On the other, risk assets, including cryptos, were put under heavy selling pressure.

The leading Bitcoin thus fell below $60,000 in just a few hours. As for Ethereum, its underperformance was even more notable with a drop below $2,900. With the panic, position liquidations reached $70 million in just one hour.

Rebound and perspectives

Nevertheless, this wave of stress was only temporary. Indeed, crypto prices quickly recovered as more information became available. It seems that the Israeli military operation was relatively limited in scope. Thus, after regaining some color, Bitcoin is trading around $64,000.

For analysts, this renewed appetite for risk is rooted in the anticipation of the next Bitcoin halving. Consequently, investors seem eager to maintain their positions in anticipation of this crucial event. However, given the minimal importance that Iranian authorities seem to attribute to the attack, the crypto drop could continue, and Bitcoin could well fall below $55,000. 

If this attack has ultimately been a short-term jolt for crypto, it nonetheless serves as a reminder of their high correlation with geopolitical risks. In the event of a lasting deterioration of the situation in the Middle East, their prices would become even more vulnerable in the future. The coming days will be decisive in assessing Bitcoin’s and its peers’ ability to withstand regional turbulence.