Bitcoin, crypto down 4% as Israel-Iran conflict escalates

Crypto markets experienced a downturn on October 1 amid escalating geopolitical tensions between Israel and Iran in the Middle East.

The top 10 cryptocurrencies by market capitalization, including Bitcoin (BTC), saw declines as Iran launched hundreds of missiles towards Israel, undermining fragile market confidence. This led to a sell-off that reduced the total crypto market cap by over 4%. Bitcoin fell 3.9%, dropping below $61,200 after reaching $65,000 the previous week.

Ethereum (ETH), BNB (BNB), and Solana (SOL) also experienced losses ranging from 6% to 7%. Meanwhile, stablecoins like Tether (USDT) and Circle USD Coin (USDC) slightly depegged but remained around the $0.99 level.

The missile attacks during the ongoing conflict also impacted the crypto-mining sector. Shares of Bitcoin miner Marathon Digital plummeted by about 9%, while fellow mining firm CleanSpark saw a 6% drop in stock prices, as reported by Yahoo Finance.

Tyr Capital CIO Ed Hindi emphasized that Bitcoin is the best investment choice for those looking to preserve their wealth amid the turmoil. He argued that the geopolitical uncertainty in the Middle East would further validate Bitcoin’s value proposition, drawing more investors into the crypto space.

Often viewed as a hedge against inflation or “digital gold,” Bitcoin has outperformed the S&P 500 in recent years, according to MicroStrategy executive chairman Michael Saylor. Hindi noted that Bitcoin should be a key consideration for investors during times of crisis in the Middle East and Europe.

He remarked, “Investors and consumers are increasingly recognizing that we are entering a period of extreme instability. Fully committing your portfolio to the traditional financial system is now a risky one-sided bet. Ongoing conflicts and tensions in Europe, the Middle East, and Asia are damaging consumer confidence and eroding faith in their governments.”