Bitcoin slides under $61,000 amid Middle East escalation

The world’s largest cryptocurrency Bitcoin (BTC) fell under $61,000 earlier today, apparently unaffected by Iran’s recent attack on Israel.

According to CoinMarketCap data, Bitcoin is trading just under $61,200 after an intraday low of under $60,300 reported earlier today. Bitcoin is trading at about 1.15% lower than its price of over $62,500, which was reported 24 hours before writing time.

The intraday volatility follows Iran’s firing of about 180 ballistic missiles at Israel on Oct. 1. Israel’s Prime Minister Benjamin Netanyahu vowed his nation would retaliate — suggesting that more instability is to be expected in the Middle East.

Iran’s launch of a missile volley was a response to a series of attacks on Lebanon in the past weeks. Israel decided to double down on its operations in the region following Iran’s response.

Crypto prediction market Polymarket saw 28% of the capital bet that Israel will militarily retaliate against Iran by Friday. A separate pool betting on what Israel will target sees 24% of the capital expecting strikes on oil and gas infrastructure, 16% on nuclear and 12% on the nation’s capital Tehran.

Bitcoin, often called digital gold, fell to the lowest price reported in over two weeks, acting as a risk asset and falling amid geopolitical unrest — contrary to claims that it is a store of value asset. Gold, on the other hand, is seeing its price rise and act as a store of value — reaching an all-time high of $2,667 per ounce.

The Block data shows that Bitcoin currently has a 0.7 correlation to gold, 0.88 to the S&P 500 and 0.89 to the Nasdaq Composite. Still, Bitcoin seemingly escapes definitions like risk asset or store of value, often becoming significantly inversely correlated to both gold and stock indexes.

The broader cryptocurrency market has seen a similar change. The cryptocurrency market shrunk from $2.2 trillion 24 hours before writing time to $2.16 trillion. This translates to $40 million leaving the crypto market as its size fell by over 1.8%.

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