Meanwhile, the slide triggered the liquidation of $83 million in long leveraged positions and $12 million in shorts. Overall, liquidations across the crypto economy topped $322 million, with liquidated long bets accounting for $267 million of the total.
Following earlier strikes in the week, the U.S. military upped the ante Sunday, striking more than 100 targets across Iran. The U.S. maintains the strikes were in response to Iranian attacks on shipping vessels transiting the Strait of Hormuz. In addition to the strikes, some media reports suggested the U.S. military was contemplating a blockade on Iranian ports.
Iran, which rejects the allegations, launched retaliatory strikes targeting U.S. bases and installations across five Gulf countries, including Qatar and Tehran’s ally Oman. Iran insists Washington is violating a memorandum of understanding (MoU).
The apparent return to full combat operations came days after U.S. President Donald Trump declared the ceasefire between the two sides over. The U.S. leader also accused Tehran of violating the terms of the MoU, which requires Iran to reopen the Strait of Hormuz.
Following the latest escalation, oil prices jumped 4.5%, with the global benchmark Brent crude breaching the $80-per-barrel mark. According to analysts, market concern is expanding beyond crude oil prices, with investors increasingly focused on disruptions to global refining capacity and fuel supply chains. Ongoing conflicts have affected refinery operations across the Middle East and, recently, key global shipping routes in the Russia-Ukraine region.
“Even if crude oil prices stabilize, gasoline and diesel prices could remain elevated due to limited refined fuel availability. This creates a risk that energy inflation may prove more persistent than markets currently anticipate,” a Bitunix analyst asserted in a recent report.
For global markets, including crypto, the central question for this week extends beyond whether U.S. inflation rises again. The bigger issue is whether global capital costs continue moving higher.
With AI investment absorbing significant funding, energy supply chains facing uncertainty, and Federal Reserve policy remaining unsettled, risk assets are likely to remain driven by the interaction among interest rates, liquidity conditions and corporate financing costs.
“For bitcoin, reclaiming and holding above $64,000 could improve short-term momentum. However, continued pressure from higher capital costs may keep BTC trapped within a broader consolidation range,” the analyst said.