Crypto markets moved lower after fresh US military strikes on Iran added pressure to risk assets. The global crypto market lost around $80 billion in value over 24 hours, while Bitcoin, Ethereum, XRP and Dogecoin all traded lower.
The selloff came as traders assessed fresh geopolitical tension, possible oil supply risks, and thinner liquidity across digital assets. Meanwhile, US stocks still closed near record levels, showing a clear split between crypto and equity market reactions.
The US military reportedly carried out new strikes late Wednesday, targeting an Iranian military site and shooting down four Iranian attack drones near the Strait of Hormuz. A US official told Reuters the drones posed a threat in the area.
The official described the actions as ‘measured,’ ‘purely defensive,’ and ‘intended to maintain the ceasefire.’ However, Iran’s Islamic Revolutionary Guard Corps reportedly said it retaliated by attacking a US airbase in Kuwait.
The strikes came during talks aimed at ending the war that began on February 28 after US and Israeli attacks. US President Donald Trump said at a White House cabinet meeting that he was ‘not satisfied’ with a deal with Iran and pointed to possible further military action.
Crypto markets had gained earlier in the week after Trump suggested that a peace deal could soon be finalized. However, fresh military action reversed that move and pushed digital assets to their weakest level since mid-April.
Bitcoin dropped 3.5% on the day and fell to $72,646 on Coinbase, marking its lowest level since April 13. The move extended recent weakness as traders moved away from risk assets.
Ethereum also fell after news of the strikes. ETH dropped more than 4% and moved below the $2,000 level, trading near $1,976 at the time of reporting. That placed Ethereum at its lowest level since late March.
Other major tokens also came under pressure. XRP and Dogecoin both traded lower as selling spread across the wider crypto market. Cryptocurrency-linked stocks also declined, with Strategy Inc. and Bitmine Immersion Technologies ending the session in negative territory.
According to Coinglass data, more than $450 million was liquidated from the crypto market in 24 hours. Long positions accounted for about $400 million of that total, showing that bullish traders faced the largest losses.
LVRG Research director Nick Ruck said markets sold off as investors priced in higher geopolitical risk, possible oil supply disruption, and a move toward safer assets.
“Bitcoin and Ethereum, despite their long-term narrative as hedges, continue to behave more like high-beta risk assets during periods of uncertainty,” Ruck said.
He added that traders are watching escalation risks in the Middle East, along with possible effects on inflation and Federal Reserve policy. He also said crypto liquidity can thin quickly when leveraged positions get flushed out.
Meanwhile, Bitcoin open interest fell 0.89% over 24 hours. However, both retail and whale derivatives traders reportedly built long positions in Bitcoin, even as spot prices moved lower.
Crude oil prices also reacted to the Middle East tension. WTI rose 3.5% and moved above $92, while Brent climbed to $98 per barrel.
At the same time, US stocks moved higher. The Dow Jones Industrial Average gained 182.60 points, or 0.36%, to close at a record 50,644.28. The S&P 500 ended 0.02% higher at 7,520.36 while the Nasdaq Composite rose 0.07% to 26,674.73.
The global crypto market capitalization stood at $2.49 trillion down 1.89% over 24 hours. Market sentiment also remained weak, with the Crypto Fear & Greed Index showing ‘Extreme Fear.’
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