Tensions rose, missiles flew, hackers and the U.S. got involved, and financial markets took a hit but bounced back quickly, even more for Bitcoin and crypto.
This has been a crazy few days...
What Went Down?
The Iran-Israel relationship has never been chill, but this past week, it took a serious and bad turn.
It all started off when Israel launched a surprise airstrike on Iran, claiming it was a protection move to stop their nuclear development. Iran responded with what they called the “largest missile strike in history” and the situation escalated from there.
Unrealistic scenes of people partying in Lebanon while literally watching missiles in the sky heading to Tel Aviv (like it was some fireworks show) were filmed and shared on socials.
Then the U.S. decided to enter the dance backing up Israel. American forces hit multiple nuclear sites in Iran. Trump even cut his G7 attendance short and told U.S. citizens in Tehran to leave immediately. The tension was going up and many feared this could spiral into World War III.
Meanwhile, the conflict took on an unexpected frontline. A pro-Israel hacking group called Predatory Sparrow stole $90 million worth of crypto from Iran’s biggest exchange, Nobitex, which they apparently dumped into inaccessible wallets.
How Did It Impact the Crypto Market?
The Crypto market usually hates geopolitical instability (unless it’s to launch a meme coin). As the missiles flew, the market took hit and all the assets prices went down. On top of that, people rushed to Polymarket to bet on the conflict’s potential outcomes. The platform saw $6 million flooded in, and the odds of a U.S. strike on Iran hit 40%, the answer came shortly after (they did).
However, Bitcoin didn’t collapse. Compared to past conflicts like the 2022 Russia-Ukraine war (which saw a 65% drop), this one only triggered a 6% dip with BTC’s value going under the symbolic level of $100k. But this didn’t last long.
Ceasefire & Rebound
Big players like institutions and ETF whales didn’t panic and just kept accumulating, showing more than ever that the crypto market is not what it used to be. Bitcoin even recovered its value in less than 48 hours (that's resilience).
On June 24, the U.S. announced a ceasefire. BTC rose to over $107K as if the past few days never happened. ETH and Solana followed the ride, and the total crypto market cap came back to $3.4 trillion. Everything was back on good tracks.
What’s Next?
Let’s be real, geopolitics will always influence the markets but investors are maturing, and especially the crypto ones.
If the Middle East conflict settles down, the investors should shift their focus on the Fed’s next moves, hoping for some rate cuts. If it escalates to a more active and global level, then the volatility will most likely shake the market again, but this time in a stronger manner. Let’s stay alert.
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