Bitcoin Slides Below $73K as U.S.-Iran Escalation Sparks $1B Liquidations
Cryptocurrency markets fell sharply after renewed tensions in the Middle East triggered a broad risk-off move, wiping out nearly $1 billion in leveraged positions. The sell-off followed U.S. airstrikes on an Iranian military site near the Strait of Hormuz, reviving geopolitical risks that traders had largely discounted in recent weeks.
Bitcoin dropped below $73,000 for the first time in months, leading declines across major digital assets as the latest U.S. strikes on Iran pressured global risk sentiment and unleashed one of the largest liquidation waves of 2026.
The largest cryptocurrency was trading at $72,978 during Thursday’s Asian session, down 3.4% over the past 24 hours and 6.3% on the week after touching a low of $72,912, according to CoinDesk data. Ether fell 4.2% to $1,976, slipping under the $2,000 mark and extending its weekly losses to 7.7%. Solana declined 3.5% to $80.57, XRP dropped 3.6% to $1.28, while Dogecoin lost 3.2% to $0.0979.
Hyperliquid stood out as the only major token still posting a weekly gain, despite falling 4.5% on the day, remaining up 2.4% over seven days. Tron also showed resilience, holding onto a 1.9% weekly gain amid the broader downturn.
The downturn triggered widespread liquidations across leveraged positions. CoinGlass data showed total liquidations reached $958.8 million over the past 24 hours, impacting more than 167,000 traders. Long positions accounted for the bulk of the wipeout at $897 million, compared to just $61 million in short liquidations.
Bitcoin led the liquidations tally with $386 million, followed by ether at $246 million. The largest single liquidation order was a $15.34 million Bitcoin position on Hyperliquid.
The heavy long bias — with roughly 93% of liquidations tied to bullish bets — underscores how traders were positioned for a continued recovery before being caught off guard by the sudden reversal. Leverage built up during May’s range-bound trading was unwound rapidly in a single session.
The catalyst stemmed from escalating tensions in the Middle East. U.S. Central Command confirmed it carried out airstrikes on an Iranian military installation near the Strait of Hormuz and intercepted four Iranian one-way attack drones targeting a commercial vessel. Officials described the operation as defensive, aimed at maintaining a ceasefire established last month.
Further escalating the situation, the U.S. Treasury imposed new sanctions on Iran’s Persian Gulf Strait Authority, accusing it of extorting vessels transiting the strategic waterway. Iran reportedly retaliated by targeting the U.S. airbase from which the strikes were launched, according to reports citing the Islamic Revolutionary Guard Corps.
Kuwait also reported heightened threats, saying explosions heard across the country were the result of air defense systems intercepting incoming missiles and drones.
President Donald Trump said the Strait of Hormuz would remain open to global traffic. “It’s international waters,” he said during a White House cabinet meeting, adding that the U.S. would “watch over it.”
Risk assets weakened globally alongside crypto. The MSCI All Country World Index fell 0.4% from record highs, Asian equities dropped 1.7%, and futures linked to the S&P 500 and Nasdaq 100 pointed lower. Oil prices rose as the escalation clouded prospects for a deal to fully reopen the strait.
The swift sell-off highlights how quickly optimism around the ceasefire has unraveled. Bitcoin had held above $74,000 through weeks of geopolitical headlines, even as ETF inflows slowed. Thursday’s break below that level — and the scale of forced liquidations — suggests markets were heavily positioned for stability and caught wrong-footed by the sudden escalation.
