Bitcoin has experienced a swift downturn, wiping out gains from the previous week over the course of a single weekend. The flagship cryptocurrency fell to $69,192 on Sunday morning, reflecting a decline of 2.2% in the last 24 hours and 3.1% over the week. This downturn follows an aggressive ultimatum issued by U.S. President Donald Trump to Iran on Saturday. Trump demanded the reopening of the crucial Strait of Hormuz within 48 hours or risk military action against the country’s power plants, stating he would “hit and obliterate” their infrastructure.
This escalated rhetoric marks a significant shift from Friday’s remarks by Trump, who indicated he was contemplating “winding down” military operations. This abrupt change in tone sent shockwaves through a market that was previously buoyed by hopes of de-escalation and stability.
Liquidation data from CoinGlass illustrates the extent of market positioning leading up to this weekend’s turmoil. A total of $299 million in liquidations occurred across 84,239 traders within the past 24 hours, with long positions accounting for around $254 million, or approximately 85% of total liquidations. Specifically, Bitcoin longs suffered losses amounting to $122 million, while Ether longs were down $95.7 million. A notable $10 million liquidation on a BTC-USDT swap at OKX was the largest recorded.
The major cryptocurrencies fell accordingly, with Ether declining by 1.8% to $2,114, XRP down 2.5% to $1.41, BNB slipping 1.4% to $633, Solana down 2.1% to $88.55, and Dogecoin declining 2.7% to $0.092. Over the past week, only Ether and Solana managed to post modest gains of 0.8% and 0.7%, respectively, while the rest of the major tokens saw losses.
The 48-hour deadline set by Trump for Iran to comply looms, with no clear indication that Iran will acquiesce. Should the country fail to meet the ultimatum, the market may face the unsettling prospect of attacks on civil energy systems, a significant escalation in an already tense conflict. Currently, the Strait of Hormuz remains effectively closed to most commercial vessels, disrupting about 20% of global oil and gas flows.
The recent rally that pushed Bitcoin’s price to $75,912 now appears to have been predicated on speculation of a ceasefire, a sentiment that rapidly dissipated over the weekend. Although the Federal Reserve’s decision to hold interest rates with a dovish stance earlier in the week was expected to bolster risk assets, traders are now hesitant to commit to bold directional positions given the looming threat of renewed military action.
