Israeli airstrikes on Iranian nuclear facilities on June 14 triggered a global risk asset selloff, with cryptocurrencies experiencing sharp declines amid escalating Middle East tensions. According to CoinDesk reporting, Bitcoin dropped 2.9% to $104,889.07 by 4 PM ET Thursday, while the CoinDesk 20 Index plunged 6.1% over 24 hours. The attack, confirmed by Israeli Prime Minister Benjamin Netanyahu as targeting Iran's nuclear capabilities, prompted Tehran to launch 100 drones toward Israel. Traditional markets mirrored the risk aversion: Nikkei 225 fell 0.89% to 37,834.25, Euro Stoxx 50 declined 1.37% to 5,287.21, and E-mini S&P 500 futures dropped 1.16%. Conversely, safe havens surged with gold futures rising 1.25% to $3,445 per ounce and Brent crude oil spiking 14% intraday. This geopolitical shock reversed prior crypto gains driven by ETF optimism, particularly impacting Solana which tumbled 9.5% despite earlier rallies on SEC filing updates. Spot Bitcoin ETFs recorded $86.3 million in daily net inflows according to Farside Investors data, though cumulative flows couldn't offset broader market panic. Polymarket traders priced a 91% probability of Iranian retaliation, amplifying uncertainty across digital asset markets. The Velo data showed derivatives open interest plummeting from $55 billion on June 12 to $49.31 billion, reflecting rapid deleveraging. Trading volumes spiked as CoinGlass reported $1.16 billion in liquidations within 24 hours, with 90% being long positions. This event underscores cryptocurrencies' persistent sensitivity to geopolitical volatility despite growing institutional adoption. Market correlations intensified with DXY climbing 0.44% to 98.35, pressuring crypto valuations alongside equity declines. The synchronous selloff across Nasdaq futures, Asian equities, and digital assets highlights embedded risk-on characteristics. Bitcoin's modest decline relative to altcoins like SOL suggests its emerging haven narrative, though gold's stronger performance indicates traditional assets retain preference during crises. Institutional flows into spot ETFs provided partial support, with BTC funds attracting $939 million month-to-date according to Farside, yet couldn't counterbalance macro-driven outflows. Crypto-correlated equities suffered parallel losses: Coinbase fell 3.84% to $241.05, while MicroStrategy dropped 2.63% in premarket trading. The incident demonstrates how Middle East conflicts rapidly transmit volatility to crypto via three channels: risk sentiment contagion, commodity price shocks elevating inflation fears, and derivative market liquidations. Technical indicators reveal critical thresholds as Bitcoin approached its 50-day SMA at $103,150 according to CoinDesk analysis. Ethereum faced resistance at daily order blocks before testing the 200-day EMA at $2,480, a key support level since May. On-chain metrics showed hashprice falling to $52.43 despite hashrate holding at 928 EH/s, indicating miner stress. Derivatives positioning turned defensive with Deribit data showing BTC put/call ratio jumping to 1.28 and ETH to 1.25, signaling increased hedging. Funding rates turned deeply negative for altcoins: DOT at -15.2%, LINK at -15.1%, and SHIB at -44.5% on major exchanges. Liquidation heatmaps identified vulnerable long positions between $102K-$104K for Bitcoin, creating potential cascading sell triggers. The ETH/BTC ratio fell 3.52% to 0.02412, reflecting altcoin underperformance. Correlations with traditional assets strengthened as Brent crude's 14% surge inversely impacted crypto valuations, while gold's 1.25% gain diverted safe-haven demand. Upcoming token unlocks pose additional pressure, including $37.26 million worth of ZKsync tokens on June 17. Trading strategies should monitor oil-gold-crypto divergences, DXY reversals below 98.0, and ETF flow sustainability amid geopolitical uncertainty. Historical patterns suggest crypto markets may rebound faster than equities post-crisis, but Middle East escalation risks necessitate cautious position sizing. How did the Israeli strike on Iran impact cryptocurrency prices? The Israeli airstrike triggered immediate risk-off sentiment, causing Bitcoin to drop 2.9% to $104,889.07 within 24 hours while altcoins like Solana plunged over 9.5%. The CoinDesk 20 Index fell 6.1% as traders fled to traditional havens like gold which rose 1.3%. What technical levels are critical for Bitcoin and Ethereum? Bitcoin tested its 50-day simple moving average at $103,150 according to CoinDesk analysis, a breach of which could trigger cascading liquidations. Ethereum's key support rests at its 200-day exponential moving average near $2,480, with resistance at daily order blocks. How did derivatives markets react to the geopolitical event? Derivatives open interest collapsed by $5.7 billion to $49.31 billion according to Velo data, while put/call ratios for Bitcoin and Ethereum surged to 1.28 and 1.25 respectively on Deribit, indicating heavy downside protection demand. Funding rates turned deeply negative for most altcoins.