Cryptocurrency markets fell sharply after Israel launched airstrikes on Iran’s nuclear and missile infrastructure, sparking a broader sell-off in global risk assets.
Crypto Markets Fall as Geopolitical Tensions Rise as Israel Attacks Iran
While Bitcoin remained stable despite the decline in the overall crypto sector, the SOL ETF lost about 10% of its value despite expectations.
Bitcoin (BTC) lost 2.9% and traded around $102,664. In contrast, gold, considered a traditional safe haven, rose 1.3% and approached an all-time high of $3,445 per ounce.
The Israeli attack, which reportedly targeted senior Iranian military officials, came shortly after the International Atomic Energy Agency accused Iran of violating limits on uranium enrichment.
Iran retaliated by launching 100 suicide drones into Israeli territory. Although the US denied involvement, the attack rattled markets and sent stocks plunging worldwide.
Market Impact Across Asset Classes
The ripple effect has spread far beyond cryptocurrencies:
Japan's Nikkei index fell 0.89%.
Euro Stoxx 50 lost 1.37%.
U.S. futures were broadly lower, with the E-mini Nasdaq-100 down 1.42%.
Oil prices rose and settled after Brent crude gained more than 14%.
Gold and silver gained, reflecting the risk aversion trend.
In the cryptocurrency market, Ethereum (ETH) was more affected than Bitcoin and fell by 8.81% to $2,523.
Solana ETF Momentum Overshadowed
The SEC reportedly requested an update to the Solana ETF S-1 filing, causing a brief spike, according to Wintermute OTC trader Jake Ostrovskis. Bloomberg analysts rate the probability of approval by the end of the year at 90%. But the geopolitical shock quickly erased those gains.
“Markets appear to be underexposed to SOL and related assets, which could create interesting opportunities once volatility subsides,” Ostrovskis said.
Derivatives and the Liquidity Shake
There was a significant easing in the derivatives markets:
Total open interest (OI) fell from $55 billion to $49.3 billion.
Binance alone lost $2.5 billion worth of OI overnight.
Put/call ratios on Deribit have risen, indicating a defensive shift among investors (BTC: 1.28, ETH: 1.25)
Funding rates turned negative and altcoins like DOT, LINK, and 1000SHIB showed sharp declines.
Despite the sell-off, BTC leverage remains high, with $84 million of long-side open positions between $102,000 and $104,000 still at risk if downward pressure resumes.
Spot ETF Flows Continue to Support Crypto
As markets react to tensions in the Middle East, flows into crypto ETFs remain strong:
BTC spot ETFs have seen inflows of $939 million since the beginning of the month.
ETH spot ETFs recorded $811 million in inflows, including $112 million on June 12 alone, marking 19 consecutive days of positive flows.
*This is not investment advice.
