How do Iranian attacks on Israel shake cryptocurrency markets?

 The Crypto Meltdown: Exploring the Impact of Middle East Crisis on Bitcoin and Beyond

Cryptocurrency Collapse

Cryptocurrencies, including Bitcoin, experienced a significant decline amidst escalating tensions in the Middle East. On Saturday evening, Bitcoin dropped by approximately 8% after U.S. officials confirmed an imminent attack. These digital assets were among the few risk assets being traded over the weekend, and the decline was interpreted as an initial response to the heightened tensions in the region. 

By Sunday morning, Bitcoin had recovered, trading above $64,000. Ether and other cryptocurrencies also witnessed substantial selling, with some experiencing declines of up to 10%.

The cryptocurrency market endured heavy selling overnight on Saturday following an unprecedented drone and missile attack on Israel by Iran. Bitcoin, which had been trading around $70,000 on Saturday evening, plummeted to below $62,000, as reported by data from the Bitstamp exchange. 

Bitcoin rebounded by Sunday morning. The sell-off for Bitcoin marked the sharpest decline in over a year, according to Bloomberg, despite recent record highs driven by inflows into U.S. spot Bitcoin ETFs.

In the Middle East, the events overnight represented the first direct attack on Israel from Iranian territory. Israel reported identifying 300 "threats of various types" and claimed to have neutralized "99%" of them. The attack on Israel was purportedly in retaliation for a suspected Israeli strike that resulted in the deaths of senior Iranian officials in Syria.

The Iranian currency experienced a record low of 705,000 rials/USD on the unofficial market around 10:30 a.m. local time on Sunday, according to data from the foreign exchange monitoring site Bonbast.