Bitcoin broke below $81,000 to an intraday low near $80,500, wiping out billions from its market cap. Over $1.1 billion in total crypto positions were liquidated, led by ether with $333 million.
Key Takeaways
- BTC dropped below $81,000 on Thursday as Brent crude oil surged to $105 amid Middle East conflict.
- Coinglass data showed total crypto liquidations topped $1.1B, led by ETH with $333M in leveraged positions wiped out.
- Analyst warn bitcoin could plunge to $75,000 if it fails to hold key support levels.
Middle East Tensions and Oil Surge Pressure Crypto
Bitcoin (BTC) price dropped below the $81,000 threshold on Thursday amid a marketwide sell-off that saw several altcoins log daily losses exceeding 5%. The retreat coincided with a surge in Brent crude oil to $105 a barrel following reports of fresh attacks on shipping vessels in the Strait of Hormuz, and revelations that the U.S. is contemplating resuming strikes on Iranian targets.
The price of BTC collapsed to an intraday low of $80,507 after shedding more than $1,500 in one hour. Hours earlier, the cryptocurrency had been struggling to hold the $83,000 support level established late Tuesday after plunging from $85,000. In fact, the cryptocurrency has been bleeding since its failed attempt to breach the $87,000 level on Oct. 6.
The cryptocurrency was recently trading approximately 3% below its Oct. 1 opening price of more than $84,200. This reversal also saw bitcoins market capitalization plunge from $1.74 trillion on Monday to just above $1.62 trillion as of this writing.
Over $1 Billion Liquidated Across the Crypto Economy
Meanwhile, bitcoins downtrend again left traders with overleveraged long positions licking their wounds. As shown by Coinglass 24-hour data, about $270 million in long bets on the cryptocurrency had been liquidated at the time of writing. Overall, liquidations across the crypto economy reached $1.14 billion, with ether (ETH) being the crypto asset with the largest combined liquidations at $333 million.
While escalating tensions in the Middle East potentially helped drive down the market, social media speculation focused on a potential sale of coins seized from the Bitfinex hacker, which the U.S. government recently moved to Coinbase Prime. However, analysts note there is no evidence the $1 billion in bitcoin has actually been sold, suggesting other catalysts are behind the downturn.
Meanwhile, some market observers, including Ted Pillows, are warning that regardless of U.S. government sales, the BTC price will likely fall further. In a post on X, Pillows said:
“BTC is expected to hit $78,000 this month. The US government is transferring out a huge amount of BTC, and this could create panic. But now all eyes will be on the $81,500-$82,000 level. Losing this, and Bitcoin could drop as low as $75,000 before any strong uptrend.”
Another social media commentator suggested that BTC could drop even further if the $81,000 neckline breaks with conviction. They added that while the market expects a V-shaped recovery, “Bitcoin might have other plans.”