Bitcoin and Ethereum fell sharply on Tuesday after Israel launched an unprecedented strike in Qatar, targeting senior Hamas officials. The escalation rattled global markets, sending investors rushing into gold and oil while crypto prices sank.
Bitcoin and Ethereum immediately dropped over 1%, while Solana and XRP each lost 1.5%. Dogecoin led losses, sliding 3.2%. Liquidation data reveals more concerning risks ahead.
Another Geopolitical Conflict To Derail The Bull Market?
Data from Coinglass showed heavy liquidations as volatility surged. Nearly $52 million in leveraged positions were wiped out in the last hour.
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Long traders bore the brunt, with $44 million liquidated. Ethereum accounted for $11.9 million in liquidations, followed by Bitcoin with $10.5 million.
The scale of losses highlights how quickly leverage unraveled. In total, liquidations amounted to $370 million over the past 24 hours. Most positions were long bets on continued gains, exposing optimism ahead of the strike.
In contrast, gold surged to a record high immediately after Israel attacked Qatar as demand for safe-haven assets spiked.
Oil prices climbed by $1 per barrel, trading just under $67. Analysts called these moves rational responses to geopolitical risk, though oil gains may prove short-lived.
The divergence reflects Bitcoin’s struggle to live up to its “digital gold” label. While gold rallied, Bitcoin behaved like a high-beta risk asset.
Correlation data confirms the shift, with the 30-day rolling link between the two assets turning slightly negative.
The strike on Doha carries major diplomatic implications, but markets reacted first to its immediate risk signals. Traders rapidly de-risked, moving out of volatile tokens into stablecoins and traditional havens.
Until confidence in its safe-haven qualities strengthens, Bitcoin is likely to follow equities and risk assets during crises, rather than diverge from them.
