- The confrontation between Israel and Iran takes a new turn after Iran launched dozens of drones in retaliation
- The possible situation of a war outbreak has caused the entire crypto market to take a huge plunge
The Middle East was plunged into chaos after Iran officially launched an attack on Israel in the late hours of local time. This has led countries around the world to remain on alert as the worsening situation could lead to significant disruptions. And the effect of a potential war has had a huge spillover on the crypto market.
The background that caused the Bitcoin crash
Tensions between the two countries worsened after the Israeli IDF attacked the Iranian consulate in the Syrian capital Damascus. The attack resulted in the death of a top Iranian general – Brig. General Mohammad Reza Zahedi and five other members of the Islamic Revolutionary Guard Corps (IRGC).
In response, the Iranian regime announced that there would be a “punishment” for the attack. The regime also warned the United States of an attack if the country became involved in the fight with Israel.
In line with this, the Iranian government launched its attack on Israel. The country has deployed dozens of drones that will reach Israel within hours. So far, however, the actual target of the attack remains unclear. Drone activity has been spotted over Iraq, and while it was initially reported that there were around 50 drones, it is now speculated that more than 500 drones have been spotted.
Moreover, the attack came as a surprise, as no one expected the Iranian regime to launch an attack directly from its territory. This is a step taken for the first time in its history.
Recovery of Bitcoin and crypto markets in line?
Bitcoin and the rest of the crypto market took the plunge immediately after reports of Iran’s attack first emerged. The price of Bitcoin (BTC) fell to a low of $61,308, but quickly recovered to trade just above this level, according to TradingView. According to CoinMarketCap, Bitcoin was trading at $62,388 at the time of writing, with losses over the past day of more than 7 percent.
Read Bitcoin’s [BTC] Price forecast 2024-25
Notably, the broader crypto market fared much worse than the coin, with several cryptocurrencies posting downsides of more than 15 percent in the past day. Of the top 20 cryptocurrencies, Polygon (MATIC), Shiba Inu (SHIB), Avalanche (AVAX) and Dogecoin (DOGE) saw the biggest hits. The currency had registered a loss of over 18 percent and more in the past day.
For now, the market appears to have stabilized as no major up or down trend has occurred in the past hour. However, the possibility of a price recovery appears uncertain at this point as tensions between the two countries continue to escalate.
Moreover, while crypto greed is high, it has fallen today and has reached the lowest point in the past month. Meanwhile, Bitcoin options volatility has risen sharply today, according to CMC. The volatility index shot up from about 69 to almost 78.9.
Source: CMC
Although the price has fallen, several crypto netizens have indicated that there will definitely be a recovery and bigger gains could be made. Tony Gallippi – the co-founder of BitPay, said on X:
Once people realize that World War III won’t happen (which it won’t), the capital flows into bitcoin and crypto will be epic. https://t.co/RkCqTaBm5h
— Tony Gallippi (@TonyGallippi) April 13, 2024
Other crypto influencers and founders also expressed optimism about the end result of events. Especially because of the upcoming Bitcoin halving, which will take place in the coming days. And based on previous trends, Bitcoin and the rest of the crypto market have registered a massive bull run.
Some of you haven’t been heard because of the COVID crash and it shows.
A cryptocurrency bull market is inevitable, provided Boden doesn’t execute a 6102.
RELAXED pic.twitter.com/wFcyvNi4jj
— Ryan Selkis (d/acc) 🇺🇸 (@twobitidiot) April 13, 2024