Bitcoin (BTC=F) and other cryptocurrencies fell significantly after Israel launched airstrikes on Iran, intensifying the already tense standoff. Early Friday morning in Singapore, Bitcoin slid as much as 3%, dipping below $103,000 before slightly recovering, according to Bloomberg data. Ether, the second-largest cryptocurrency, suffered an even steeper loss, dropping about 7.6% at one point.

The selloff followed reports of explosions in Tehran. Israeli Defense Minister Israel Katz declared a special state of emergency, describing the attack as a “preemptive strike against Iran.” Katz warned that Israel is expecting retaliatory drone and missile strikes.

Caroline Mauron said,

“Crypto is reacting negatively to news of Israel strikes in Iran, in line with major risk assets We expect technical support around $101,000, but geopolitical news will continue to influence price movements in the short term.”

The turmoil wasn’t limited to cryptocurrencies. Stocks and equity futures also declined as investors moved toward safer assets like U.S. Treasuries. Oil prices surged more than 9%, while gold prices also climbed amid the uncertainty. Sean McNulty, derivatives trading lead for APAC at FalconX Ltd., highlighted that Bitcoin’s decline reflects typical market behavior during geopolitical crises:

“While Bitcoin has sometimes acted as a macro hedge, during acute risks such as military conflicts, liquidity is prioritized over narrative. Traders raise cash, shift into dollars, and reduce exposure to leveraged or volatile assets.”

Data from Coinglass revealed that over $1 billion worth of long cryptocurrency positions were liquidated in the last 24 hours. Market analyst Tony Sycamore from IG warned of a further deterioration in risk sentiment as the weekend approaches. As of 10:40 a.m. At Singapore time on Friday, Bitcoin was trading at $103,540.

Why does geopolitical tension impact cryptocurrencies?

Although cryptocurrencies like Bitcoin are often viewed as “digital gold” or safe havens, during sudden geopolitical conflicts or crises, investors tend to prefer liquidity and move to traditional safe assets like the US dollar, gold, or government bonds. This causes a sharp selloff in more volatile assets, including cryptocurrencies.

What does technical support around $101,000 mean?

Technical support is a price level where Bitcoin historically tends to find buyers which could stop or slow down further price declines. If Bitcoin falls to this level, it may stabilize or bounce back but geopolitical uncertainty can override these patterns.