Bitcoin Tumbles 6% as Iran Missile Attack Intensifies Middle East Tensions

Bitcoin fell more than 6% early on Tuesday as a result of Iran's missile attack on Israel, which intensified tensions in the Middle East.

Bitcoin dropped more than 6% early on Tuesday after Iran launched a missile attack on Israel, escalating tensions in the Middle East. Bitcoin fell to its current level, just below $61,000, as soon as the cryptocurrency market opened.

Bitcoin had already dropped from around $62,200 earlier in the day, adding to the volatility that has sparked unrest around the world. Investors rushed out of riskier assets like Bitcoin and into traditional safe havens like gold amid concerns over the war.

Missile strikes not only hit the ground but also the financial markets as the US administration announced that President Joe Biden had ordered military assistance to Israel.

Investors are now concerned about the impact of this intervention on global security and the possibility of further escalation. Bitcoin lost around $3,800 in just a few hours as news feeds were flooded with reports of missile launches. It briefly dropped to around $60,200 but later recovered slightly to around $61,500 by the end of the day.

Traders were hoping for a bullish October, also known as “Uptober” for its historical gains, but the unrest dashed that dream. The selloff was exacerbated by large liquidations in major cryptocurrencies.

Positions in Bitcoin and Ethereum alone lost over $481 million. In the past, cryptocurrency values have shown sharp drops in response to geopolitical events, highlighting Bitcoin’s sensitivity to global developments.

While Bitcoin was struggling, gold prices surprisingly rose by 1.2% to near record highs as investors worried by the uncertainty sought safety in the precious metal. In fact, this is not a new trend that has been observed before.

People observed this pattern during the Russia-Ukraine tensions and the brewing tensions between the US and China. Traditionally, Bitcoins have rallied well after initial declines on global turmoil.

However, there are still traders who want to hedge the price and are rushing to reduce their investments, which is causing the price to go down.

The present scenario leaves many wondering what the future holds for Bitcoin and other cryptocurrencies. According to analysts, Bitcoin may test the $60,000 support – or lower – if the situation worsens.

The featured image is from The Times of Israel and the chart is from TradingView.

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