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Bitcoin Drops 2.9% as Israel-Iran Conflict Sparks $1.16B Crypto Liquidations | Flash News Detail | Blockchain.News
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6/25/2025 10:46:00 PM

Bitcoin Drops 2.9% as Israel-Iran Conflict Sparks $1.16B Crypto Liquidations

Bitcoin Drops 2.9% as Israel-Iran Conflict Sparks $1.16B Crypto Liquidations

According to Francisco Rodrigues, cryptocurrencies declined sharply due to Israeli airstrikes on Iran escalating geopolitical tensions, with bitcoin (BTC) falling 2.9% and a broad crypto market index losing 6.1% over 24 hours. SOL dropped 9.5% despite earlier gains from SEC ETF updates, as Jake Ostrovskis noted optimism for Solana ETF approvals. Velo data showed open interest plunging to $49.31 billion, while Deribit data revealed increased BTC and ETH put/call ratios indicating higher demand for downside protection. Coinglass reported $1.16 billion in liquidations, predominantly from long positions, amid heightened market volatility.

Source

Analysis

Geopolitical Turmoil Sparks Crypto Market Volatility

Cryptocurrencies experienced significant declines following Israeli airstrikes on Iran's nuclear and missile sites, which escalated Middle East tensions and triggered a global risk-off sentiment. According to market data as of 4 p.m. ET on June 13, bitcoin (BTC) dropped 2.42% to $104,889.07 over 24 hours, while ethereum (ETH) plunged 8.81% to $2,523.28, erasing gains from earlier ETF approval speculation. The CoinDesk 20 Index fell 6.04% to 3,007.21, reflecting broad market weakness. This sell-off coincided with a 6% surge in U.S. crude oil futures to $73 per barrel and a 1.25% rise in gold futures to $3,445 per ounce, as investors sought traditional safe havens amid the conflict. Jake Ostrovskis, an OTC trader at Wintermute, noted that SOL had rallied earlier on SEC-related ETF updates but reversed sharply, losing 9.5% in 24 hours due to the geopolitical shock.

Derivatives and Liquidation Dynamics

Open interest across major crypto derivatives venues plummeted from a June 12 peak above $55 billion to $49.31 billion by June 13, as reported by Velo data, signaling widespread deleveraging. Binance alone shed over $2.5 billion in open interest overnight, with similar reductions on OKX, Bybit, and Deribit. Options markets turned defensive, with Deribit data showing BTC and ETH put/call ratios climbing to 1.28 and 1.25, respectively, indicating heightened demand for downside protection. Funding rates remained negative, particularly for altcoins like DOT at –15.2% and LINK at –15.1% on Deribit, though AAVE showed a long bias at +9.95%. Coinglass reported $1.16 billion in liquidations over 24 hours, with 90% stemming from long positions. Liquidation heatmaps revealed untriggered long-side open interest clusters between $102K and $104K for BTC, which could exacerbate declines if breached.

ETF Flows and Institutional Sentiment

Despite the market rout, spot bitcoin ETFs demonstrated resilience with $86.3 million in daily net inflows on June 13, contributing to cumulative net flows of $45.29 billion month-to-date, as per Farside Investors data. Ethereum ETFs also attracted $112.3 million in daily inflows, totaling $3.87 billion in net inflows. This institutional demand contrasts with retail panic, underscoring a divergence in market participants. Bloomberg ETF analysts Eric Balchunas and James Seyffart maintained a 90% probability for Solana ETF approval by year-end, potentially accelerating launches within three to five weeks of updated S-1 filings. However, Polymarket traders priced a 91% chance of Iranian retaliation this month, elevating geopolitical uncertainty and overshadowing near-term catalysts like Brazil's B3 exchange launching USD-settled ETH and SOL futures on June 16.

Technical Outlook and Trading Strategies

Technical analysis reveals critical support and resistance levels shaping short-term trading opportunities. Ethereum faces stiff resistance at its daily order block, with prices briefly dipping below Monday's low of $2,480 before reclaiming it. A daily close above this level—aligned with the 200-day exponential moving average—would signal strength. Bitcoin's 50-day simple moving average at $103,150 serves as a key support, with downside risks amplified by $84 million in long liquidation zones between $102K and $104K. Upcoming token unlocks add supply pressure, including $31.28 million worth of ARB on June 16 and $37.26 million in ZK on June 17. Traders should monitor ETH/BTC ratio movements, currently at 0.02412 after a 3.52% drop, for altcoin correlation shifts. With BTC dominance at 64.77%, capital rotation into bitcoin could intensify during volatility.

Market Sentiment and Forward Catalysts

Geopolitical fears dominate sentiment, with Polymarket odds of U.S. military action against Iran jumping from 4% to 28%, per trader activity. This overshadows positive developments like Circle's IPO and Ripple's $125 million settlement motion with the SEC. Upcoming events include the G7 Summit from June 15-17 and the U.S. Senate vote on the GENIUS Act for stablecoins on June 17, which could influence regulatory sentiment. For tactical entries, watch for ETH stability above $2,480 and BTC bounces from $103,150, leveraging negative funding rates for cost-efficient longs. Avoid overexposure to high-unlock tokens like STRK and SEI, while tracking AI-linked assets such as RNDR for sector-specific opportunities amid broader uncertainty.

Farside Investors

@FarsideUK

Farside Investors is a London based investment management company. Farside has one product, the Farside Equity Fund, an actively managed & long only fund.

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