The crypto market experienced a sharp decline on Saturday, February 28, wiping out $70 billion in total market capitalization within an hour, just as news of a U.S. strike on Iran broke.
To be specific, the overall crypto market cap dropped from roughly $2.24 trillion to $2.17 trillion between 7:00 a.m. and 8:00 a.m. (UTC+1), judging by the real-time data Finbold accessed on TradingView.
Crypto market crashes amid Iran escalations
Digital assets were among the first major financial instruments to respond to the geopolitical escalation.
Bitcoin (BTC), still the biggest cryptocurrency by market capitalization, slid toward $63,000, roughly 3.5% within hours of the strike. While it has somewhat recovered since, trading at $63,400 at press time, it is still down nearly 6.5% on the day.
The downturn spread across major altcoins, too. Ethereum (ETH), for instance, fell 9% to $1,850, while XRP dropped 8.75% and Solana (SOL) sank 10%.
In contrast, tokenized gold emerged as a safe haven. Tether Gold and Pax Gold, for instance, each gained more than 3%. As for spot gold, the price hovers at $5,278 per ounce, up some 2%.
$100 million in long positions lost within minutes
Just minutes after headlines broke, $100 million in long positions were liquidated across major exchanges, according to CoinGlass data available at press time. Daily long liquidations have gone up to nearly $445 million.
Unsurprisingly, Bitcoin and Ethereum made up the bulk of liquidations, as traders positioned for further upside were blindsided by the abrupt geopolitical escalation.
Interestingly, when Iran launched missile strikes on Israel in April 2024, Bitcoin also dropped to roughly $61,000. However, the following months led to new highs, suggesting short-term rallies are also a possibility.
Featured image via Shutterstock
