Bitcoin steadied after suffering its biggest drop in more than a year, part of a broader slide in cryptocurrency markets as rising geopolitical tensions in the Middle East spurred risk aversion.
The price of the largest cryptocurrency fell 7.7% on Saturday, marking its biggest drop since March 2023. The token pared some of the decline to trade at around $63,700 at 6:35 a.m. in Singapore on Sunday. Most other major coins including ether, Solana and crowd favorite Dogecoin suffered losses throughout the day.
Iran has launched attack drones and missiles at Israel in apparent retaliation for a strike in Syria that killed senior Iranian military officers, taking the conflict in the region into a dangerous new phase.
Digital assets trade over the weekend, giving investors a glimpse into the likely mood when traditional markets reopen on Monday, though a lot could change between now and the reopening.
Selling pressure
Zuhair Ebtekar, founder of crypto fund Split Capital, said that the continued sell-off in cryptocurrencies may depend on further escalation, adding that investors are really looking forward to seeing what the markets will look like on Monday.
As Israel braces for an attack, the (political) tensions hurt stocks on Friday and boosted havens like bonds and the dollar. Coinglass data shows that about $1.5 billion in bullish bets on cryptocurrencies via derivatives were liquidated on Friday and Saturday, one of the heaviest two-day liquidations in at least six months.
“Borrowing has completely deteriorated in the past three days, causing prices to fall significantly in digital assets,” Ebtikar said.
Bitcoin has fallen about $10,000 from its record high of $73,798 in mid-March. Demand for exchange-traded funds, which debuted in January, has helped propel the cryptocurrency to all-time highs, but net inward investment into the products has fallen recently.
Cryptocurrency speculators are awaiting the so-called Bitcoin halving, which will reduce the new supply of the token by half, and is expected to occur around April 20. Historically, halvings have proven to be a supportive event for prices, although there are growing doubts about whether this is likely to happen again, especially after Bitcoin recently reached a record high.
