Bitcoin Crashes to Almost $60,000 After Iran Bombs Israel

On Tuesday, Iran launched a missile attack on Israel in response to the recent killing of Hezbollah leader Hassan Nasrallah. The attack came after the U.S. warned that tensions in the region were likely to escalate.

Rising tensions in the Middle East have led the U.S. to increase its military presence. Missiles from Iran targeted Israel, with air raid sirens sounding and residents advised to seek shelter. According to Bloomberg, between 100 and 200 missiles were fired. Iran stated the assault was in retaliation for the killing of Nasrallah and other senior leaders, threatening more attacks if Israel responds.

This marks Iran’s first direct missile strike on Israel since April.

The attack may signal further escalation in the region, and the U.S. could respond. A senior White House official warned that Iran would face serious repercussions for the strike. The U.S. also stated it is actively supporting Israel’s defense preparations. President Joe Biden and Vice President Kamala Harris convened with national security officials to discuss potential responses to the attack.

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Israeli Prime Minister Benjamin Netanyahu had previously warned that no part of Iran or the Middle East is beyond Israel’s reach. U.S. Secretary of State Antony Blinken emphasized America’s commitment to Israel’s defense, stating they are closely monitoring the situation.

Market Reactions

Gold and oil prices surged following the attack. The United States Oil Fund (USO) jumped 4% to $72.39, while the SPDR Gold Trust (GLD) gained 1% to $245.99. On the other hand, the SPDR S&P 500 ETF Trust (SPY) dropped 1% to $567.35, following recent record highs.

Other indexes, such as the SPDR Dow Jones Industrial Average ETF (DIA) and Invesco QQQ Trust (QQQ), also traded lower, with tech stocks seeing the biggest losses and defense and oil stocks performing better.

Crypto Takes a Nosedive

The cryptocurrency market reacted negatively to the escalating conflict, with Bitcoin falling to a low of  around $60,300. BTC managed to regain some of the losses, but is still trading below $61,000. Altcoins were not immune to the sudden downturn either.

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Ethereum lost 5.96% in the past 24 horus and is currently priced at $2,455. Solana crashed by 7.2% to $145.3, while memecoins such as Dogecoin experienced sharp drops.

The total crypto market cap declined by 5.07%  to $2.14 trillion. After the recent gains, this correction has renewed the bullish santiment, especially considering the potential of further escalation of the conflict in the Middle East.

Alexander Stefanov