Bitcoin Drops to $60K Amid Middle East Tensions

The cryptocurrency market took a steep dive on Tuesday night, with bitcoin slumping to the $60,000 mark amidst rising tensions in the Middle East. This plunge marks a rocky commencement for what is usually a robust month for Bitcoin.

Bitcoin and Other Cryptos Face a Challenging Start

Bitcoin dropped nearly 4%, standing at $60,972.62 according to Coin Metrics. At around 4:45 p.m. Eastern time, Bitcoin slipped to a low point of $60,175. Likewise, Ether was last observed trading at $2,449.83, down by over 5%.

Stocks Linked to Cryptos Also Falter

Alongside cryptocurrencies, stocks related to virtual currencies also faced downturns in extended trading. Crypto exchange Coinbase saw a dip of roughly 1%, and bitcoin proxy MicroStrategy experienced a 2% loss, after already closing 7.4% and 3.5% lower respectively.

Geopolitical unrest has considerably influenced market sentiment. On Tuesday, heightened tensions arose when Iran executed a ballistic missile attack on Israel in retaliation for the killing of Hezbollah leader Hassan Nasrallah and an Iranian commander in Lebanon.

“The turmoil in the Middle East has pushed oil prices up and strengthened the dollar, casting a looming shadow over bitcoin and similar speculative investments,” observed Chris Kline, COO and co-founder of Bitcoin IRA. “The scenario for Bitcoin in October stands in stark contrast to its outperforming September, primarily affected by the delayed impacts of spring’s halving event and looming U.S. elections.”

Kline further noted, “A global financial tug-of-war is underway as various central banks reduce interest rates and inflate their money supplies.” Additionally, stakeholders are vigilant about a strike by the International Longshoremen’s Association on the East and Gulf Coasts, which might impact the U.S. economy based on its duration.

Historically, October and November have been the best months for Bitcoin, recording gains in all but two years since 2013 with an average return of nearly 23%. Thus, October has garnered the nickname “Uptober” among crypto investors.

While Bitcoin has experienced challenges surpassing the $70,000 mark, the $55,000 threshold has proven to be strong support. Although some investors question if October will be the month Bitcoin regains momentum, there is widespread optimism that the cryptocurrency will aim for new highs in the new quarter.