Bitcoin and other cryptocurrencies fell on June 13, following Israel’s missile strikes on Iran, raising geopolitical tensions.

The broader market also shifted, with equity futures dropping as investors moved to safe havens like gold and oil.

Bitcoin briefly dropped to US$103,802 before recovering to around US$105,000.

The downturn triggered US$1.1 billion in liquidated crypto positions, with bitcoin making up US$441 million.

The largest single liquidation was a US$201.3 million BTC/USDT trade on Binance, according to CoinGlass.

Analysts warned of further volatility amid the Middle East conflict. QCP Capital noted that a prolonged crisis could impact global oil supplies, pressuring crypto markets.

🔗 Source: The Block

🧠 Food for thought

1️⃣ Bitcoin’s inverse dollar relationship offers long-term context beyond geopolitical noise

Bitcoin’s consistent inverse relationship with the US Dollar Index (DXY) represents a more fundamental driver than short-term geopolitical events, supporting analyst Nic Puckrin’s assertion about the dollar’s importance.

Historical data shows Bitcoin typically moves in the opposite direction of the DXY, functioning as a potential hedge against dollar strength 1.

This pattern is demonstrated by Bitcoin’s performance against the DXY, which recently hit a three-year low below 100, coinciding with Bitcoin’s climb to record highs before the Middle East tensions 2.

Research covering 2013-2021 confirms this relationship, showing Bitcoin is positively linked to risk assets (stocks, bonds, commodities) but negatively correlated with the US dollar over the long term 3.

However, this established correlation is showing signs of potential change, with recent market data indicating Bitcoin rising despite dollar strength, particularly as the US election approaches. This suggests evolving market dynamics 4.

2️⃣ Bitcoin’s volatility follows predictable cycle patterns despite unpredictable triggers

Bitcoin price movement research reveals distinct cyclical phases—Reversal, Bottoming, Appreciation, and Acceleration—providing context for understanding current market behavior beyond single geopolitical events 5.