Bitcoin falls below $105,000: What's behind the dramatic drop?

Bitcoin falls below $105,000: What's behind the dramatic drop?

The cryptocurrency market has been experiencing a turbulent period in recent days. The price of bitcoin (BTC) has plummeted to around $103,000, its lowest level since the beginning of the year, and many analysts are beginning to speculate whether this is the start of a larger downward trend. This dramatic swing came at a time when tensions in the Middle East escalated following Israel's attacks on Iran, which significantly affected not only the geopolitical situation but also the financial markets.

Explosions and tensions in the Middle East

On Thursday evening, shortly before midnight UTC, explosions rocked the Iranian capital Tehran, for which Israel claimed responsibility. These incidents, which are reported to have caused significant tremors in the region, led to tensions that were immediately reflected in the financial markets. The price of bitcoin fell 2.8% in just 90 minutes, from USD 106,042 to USD 103,053, before recovering partially to around USD 104,370. The drop caught many traders off guard, and according to CoinGlass, approximately $427.84 million in long positions were liquidated in the last 24 hours.

Traders and experts in shock

A few days ago, bitcoin was just below its all-time high of $111,940 on May 22. Now its price is hovering around 104,000, raising questions about whether this decline is temporary or a signal of a deeper correction. Some cryptoanalysts point out that while gold and oil are experiencing growth, bitcoin is currently in a reverse trend, which could change soon.

What do the experts say?

Anthony Pompliano, a well-known bitcoin entrepreneur, commented on the situation, saying that history shows that in periods of heightened uncertainty, bitcoin often behaves differently from traditional assets. "When Iran fired hundreds of rockets into Israel in October, the price of bitcoin plunged 3%, but eventually outperformed gold and oil in the first 48 hours," Pompliano recalled. He added that it is still too early to draw conclusions and it is important to see how the situation develops.

The political reaction and possible market impact

Israeli Prime Minister Benjamin Netanyahu announced that his military is conducting targeted strikes on Iran's nuclear program and that the operation will continue until the threat is eliminated. In response, Iran's Supreme Leader Ayatollah Ali Khamenei warned that Israel "should expect severe punishment," and the country has reportedly sent more than 100 drones in retaliation.

U.S. Secretary of State Marco Rubio assured the public that the United States had no involvement in the attacks, adding another layer of uncertainty.

A buying opportunity or a warning?

While some experts warn of a possible prolonged correction, others see this situation as an opportunity for long-term investors. Samson Mow, founder of Jan3, said in a post in response to the downturn that "this is the place to buy when you're feeling scary." According to him, now is the perfect time to accumulate bitcoins, especially if the price drops even lower.

Conclusion: uncertain future, but potential on the horizon

The situation in the Middle East is still tense and uncertainty in the markets persists. What the next steps are taken by Israel, Iran or the international community could significantly affect not only the price of bitcoin, but also the entire cryptocurrency sector. Investors should be cautious, but also keep an eye on opportunities that may arise in these turbulent times.

*This is not an investment recommendation.

Coingarage team