Crypto Liquidations Near $1 Billion in 24 Hours Following New US Strikes on Iran
In a dramatic market reaction to renewed geopolitical tensions in the Middle East, cryptocurrency liquidations have surged to nearly $1 billion within a 24-hour period. The spike in liquidations follows fresh strikes by US forces against targets in Iran, triggering a widespread sell-off that wiped out approximately 167,400 leveraged trader accounts.
According to data from CoinGlass, total liquidations reached $934.24 million, with long position holders bearing the brunt of losses. Longs accounted for a staggering 93% of these liquidations, indicating that most traders were betting on a market recovery that failed to materialize amid escalating conflict. Short sellers largely emerged unscathed during this sell-off.
Bitcoin (BTC) and Ethereum (ETH), the two largest cryptocurrencies by market capitalization, suffered the heaviest impacts. BTC liquidations topped $363 million, while ETH liquidations followed closely at $240 million. Highlighting the scale of the sell-off, the largest single liquidation order recorded was a $15.34 million BTC long on the Hyperliquid exchange.
The liquidation wave corresponds with a sharp downturn in bitcoin’s price, which fell below the $73,000 mark during the rout. This decline extended a downward trend that began earlier in the week when then-President Donald Trump publicly expressed doubts about ongoing diplomatic efforts to resolve tensions with Iran. The broader risk assets market also moved sharply, with Brent crude prices surging amid concerns about potential disruptions to shipping lanes in the strategically vital Strait of Hormuz.
The new round of US military strikes targeted Iranian assets connected to one-way attack drones near the Strait of Hormuz, alongside a ground control station at Bandar Abbas. US Central Command justified the attacks by referencing threats to American forces and maritime traffic in the region. Iranian state media reported no casualties, while neighboring Kuwait activated air defenses in response to incoming missiles and drones.
These developments have abruptly ended hopes for a ceasefire, which both sides had hinted at just days earlier. During a cabinet meeting on Wednesday, Trump confirmed talks had stalled, warning that the US might "finish the job" if diplomatic efforts failed. This hardline stance reversed earlier market optimism sparked by Trump’s prior commitments to de-escalate the conflict.
Market watchers now face considerable uncertainty about whether Washington and Tehran will resume negotiations or if further military actions will follow. Any disruption to shipping through the Strait of Hormuz could have far-reaching consequences for global oil supply and prompt additional risk-off market moves. The ongoing US crackdown, dubbed Operation Economic Fury, has also intensified pressure on Iran’s digital asset ecosystem.
For the cryptocurrency market, the current liquidation event recalls the earlier cascade in the year where $1.7 billion in liquidations occurred, demonstrating how quickly highly leveraged positions can unwind during geopolitical shocks. Traders will be closely monitoring funding rates and open interest in the coming days to gauge whether market sentiment is resetting or simply preparing for another wave of leveraged long positions.
Bitcoin’s price has already absorbed an earlier dip linked to Hormuz-related tensions, but renewed volatility could test the critical $70,000 support level.
This recent episode underscores the persistent volatility of cryptocurrency markets amid global political developments and highlights the risks associated with leveraged trading strategies.
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Disclaimer: This article is for informational purposes only. Readers should conduct their own research and consult financial professionals before making investment decisions.