Cryptocurrencies tumble after U.S. airstrikes in the Strait of Hormuz trigger risk-off sentiment and leveraged long unwinds.
Bitcoin and Ether fell sharply as U.S. airstrikes in the Strait of Hormuz drove oil prices higher, stoking inflation fears and liquidating $897 million in crypto longs. Bitcoin dropped to its lowest level since April 13, while Ether broke below $2,000 for the first time since March 29.
Nearly $958 million in crypto positions were wiped out in 24 hours, with longs accounting for the bulk of the losses. Ether open interest reached a record even as the token declined, signaling traders are adding shorts rather than buying the dip. Bitcoin’s max pain for $8 billion in expiring options is $75,000, just above its current $73,400 level.
Oil prices surged to $96 a barrel before settling at $94, amplifying concerns over inflation. U.S. equity futures also dipped, with S&P 500 and Nasdaq 100 derivatives down 0.11% and 0.25%, respectively.