Bitcoin price drops sharply after Israel attacks Iran and closes $100 million in minutes

Bitcoin prices plunged following news of Israel launching a pre-emptive strike against Iran, confusing global markets and prompting investors to reduce exposure to riskier assets, especially digital currencies.

Immediately after the news was released, Bitcoin, the largest currency by market value, fell about 4%, from about $65,500 to nearly $63,000.

At press time, the coin was trading above $64,000, down nearly 6% in 24 hours.

Reflecting the fragility of leveraged positions, nearly $100 million worth of long positions on major trading platforms were liquidated in a wave of forced selling in just 15 minutes after the emergency headlines were published, according to derivatives market data.

Israel announced the operation early Saturday morning before explosions were heard in Tehran.

Israel’s defense minister said the goal was to neutralize the imminent threat while declaring a state of emergency.

The Israeli army also warned of possible retaliatory missile launches and sounded sirens across the country, calling on residents to stay near shelters.

Restrictions were imposed on schools, workplaces and public gatherings in anticipation of further escalation.

Meanwhile, there are reports of U.S. involvement and coordination with Israel, but the extent of that involvement remains unclear.

Geopolitical tensions are always reflected in Bitcoin’s price action.

The currency saw a similar decline in April 2024 following Israel’s missile attack on Iran.

Previous crises, such as the US-China trade war or the Russia-Ukraine conflict, have also led to wild market swings.

Despite short-term shocks, digital currency markets have historically shown the ability to recover after significant sell-off waves, but the near-term path will still depend on the development of the geopolitical landscape and the extent of regional escalation.

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