Sophia Bennett
Crypto Analyst
Bitcoin tumbled back below $80,000 late Thursday after the U.S. launched fresh airstrikes in Iran, causing Brent crude oil to briefly top $100 per barrel before giving back a portion of gains during Asia and European hours.
The move was sharp, fast, and painful for anyone holding leveraged long positions going into the weekend.
What Triggered the Sell‑Off
Geopolitics did what it often does, it arrived without warning and repriced risk across every asset class simultaneously.
Renewed tensions between the U.S. and Iran sparked a risk‑off sentiment across global markets. After Bitcoin tested resistance near $82,000, traders began securing gains, leading to a technical retracement. Over $90 million in long positions were liquidated within 24 hours, accelerating the downward momentum as Bitcoin broke below key support levels.
The crypto market was already slightly jittery after Strategy chairman Michael Saylor said the company would consider selling Bitcoin to cover dividend payments, a notable U‑turn from its previous stance.
The Liquidation Numbers Tell the Full Story
When leveraged traders get caught on the wrong side of a fast move, the numbers escalate quickly.
Crypto traders unwound leverage aggressively, with futures open interest falling 1.5%, nearly $300 million in liquidations, and options flow shifting toward protective BTC puts.
Market data showed more than $269 million in long positions liquidated over the past 24 hours according to CoinGlass. Ethereum traded near $2,301 and XRP near $1.39, each down more than 2% for the day.
The options market shift was equally telling. Traders were not just cutting positions, they were actively buying downside protection, a sign that confidence in the near‑term recovery had cracked.
Profit‑Taking Was Already Building
The Iran strikes were the spark, but the fuel had been building for days.
CryptoQuant warned unrealized profits had climbed to levels not seen since June 2025, increasing incentives for traders to lock in gains. The firm reported the May 4 profit realisation was the largest single‑day event since December 10, with holders realising 14,600 BTC in daily profits.
CryptoQuant said Bitcoin's 37% rebound from April lows still looks more like a bear‑market rally than a confirmed trend reversal, with short‑term holders increasingly exiting into strength.
The One Bright Spot: DeFi Holds Up
Not everything fell. While Bitcoin and most major altcoins retreated, one corner of the market held its ground.
Despite weakness in majors and memecoins, DeFi tokens outperformed as ONDO jumped over 8% following a cross‑border U.S. Treasury redemption involving JPMorgan, Mastercard, and Ripple.
It was a reminder that even in broad market sell‑offs, specific catalysts can override the macro noise.
What the Market Is Pricing In Now
Despite the drop, not everyone is turning bearish.
Users on the prediction market Myriad placed roughly 83% odds that Bitcoin will reach $84,000 before it falls to $55,000. That suggests traders see this as a temporary pullback rather than the start of something more serious.
Key levels around $78,200 to $79,100 have been reclaimed, but resistance near $85,200, ongoing long‑term holder profit‑taking, and cautious prediction markets point to lingering scepticism about a sustained bull run.
Bitcoin is not broken. But until something shifts the macro picture, a ceasefire, a Fed pivot, a fresh wave of institutional inflows, the road back above $80,000 and beyond will remain a difficult one to hold.
