Bitcoin’s wild ride took a sharp turn Sunday as it crashed below the $100,000 mark for the first time since May 8. The drop comes as geopolitical tensions erupted into crisis following a U.S. airstrike ordered by former President Donald Trump on key Iranian nuclear facilities.
Within hours, global crypto markets shed billions. Investors ran for cover, spooked by fears of a prolonged conflict, surging oil prices, and potential retaliatory strikes from Iran and its allies.
A Weekend to Forget for Crypto Traders
Bitcoin’s plunge was swift and brutal. From its recent peak this month, the world’s largest cryptocurrency has lost over 10%, officially entering correction territory.
It wasn’t just Bitcoin that took a hit.
The altcoin market fared even worse. Tokens like Sei, Injective, Ondo, Ethena, and Jasmy each fell more than 10% in the last 24 hours. The total crypto market cap slid by over 4%, dipping to $3 trillion. And liquidations? Those skyrocketed—up 154% to over $1 billion.
That’s not just a dip. That’s a bloodbath.
What’s Driving the Crash?
This isn’t just about crypto. It’s about chaos—real, geopolitical chaos.
Donald Trump’s surprise military action on Sunday targeted three Iranian nuclear sites. The move, reportedly coordinated with Israeli intelligence, immediately provoked fury in Tehran. Iran, along with its Houthi allies in Yemen, responded with threats—and action. Missiles began raining down on Israeli positions just hours later.
Markets don’t like surprises. They hate missiles even more.
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Historically, global crises have been poison for risky assets:
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Bitcoin plunged during the early days of COVID.
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It cratered during the collapse of FTX and Terra.
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It fell sharply after Trump’s Liberation Day tariff blitz last month.
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Now, crypto is being dragged back into that volatility—hard.
The Oil Factor That’s Stirring the Pot
Here’s where it gets more complicated: oil prices.
Brent crude has surged over 30% in just a few weeks. And with Middle East oil infrastructure now at risk, analysts say the $100 oil barrel isn’t just possible—it’s likely.
For crypto, that’s terrible news.
More expensive oil means higher inflation. And that’s a nightmare for central banks already trying to juggle inflation, rates, and economic slowdown. If inflation climbs, the Federal Reserve may be forced to keep interest rates elevated longer than markets were expecting.
And Bitcoin? It usually thrives when rates are falling—not rising.
Altcoins: Collapsing Under the Weight
If Bitcoin stumbled, altcoins completely faceplanted. That’s not unusual—these smaller, more volatile tokens often suffer the worst during a panic.
Sei fell over 12%. Injective? Down more than 13%. Jasmy, which had been on a tear earlier this year, lost nearly 15% in just a day.
These drops weren’t gradual. They were vertical.
In just 24 hours, some traders lost thousands. Others lost millions. According to Coinglass, over $1 billion in positions were liquidated across exchanges—mostly in long positions.
It wasn’t just speculative bets. It was stop-losses, auto-sells, and forced margin calls.
Here’s Where the Market Stands Now
To make sense of the chaos, here’s a quick snapshot of where major assets stood Sunday night:
| Asset | 24H Change | Current Price | % From 2024 High |
|---|---|---|---|
| Bitcoin (BTC) | -10.5% | $98,200 | -13% |
| Ethereum (ETH) | -8.9% | $5,180 | -11% |
| Sei (SEI) | -12.1% | $0.36 | -23% |
| Injective (INJ) | -13.4% | $28.90 | -26% |
| Jasmy (JASMY) | -14.6% | $0.021 | -29% |
Will the Fed Step In—or Step Back?
One big question now is whether the Federal Reserve shifts its stance.
If the Middle East crisis pushes inflation higher, the Fed could delay any planned rate cuts. That would hurt not just crypto, but stocks, real estate, and other risk assets.
But if geopolitical instability spooks markets too much, central banks might feel forced to ease policy sooner—just to calm the storm.
It’s a tough balancing act. And one that has crypto investors watching every word from Fed Chair Jerome Powell this week.
Also, this week’s economic data could tip the scales:
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U.S. Q2 GDP report on Thursday
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May PCE inflation data on Friday
If inflation softens or growth slows, there’s a chance for a relief rally. If not? Strap in.
What Could Trigger a Rebound?
Despite all the gloom, there are glimmers of hope—if barely.
Iran’s next move is critical. If Tehran holds back from major retaliation, or if back-channel diplomacy takes hold, markets could stabilize quickly.
Bitcoin has shown resilience in the past. After the COVID crash, it bounced back sharply. After the FTX implosion, it eventually rallied over 200%.
A de-escalation in the Middle East could be the spark for another turnaround.
But there’s a massive caveat: if Israel or the U.S. hits Iranian oil facilities, it’s game over for now. Such a strike could set off a deeper regional war—and send crypto tumbling even further.
