Geopolitical tensions and $1.8B in derivative sell pressure intensify volatility across crypto markets.
Investors felt disappointment after Bitcoin’s price dumped on Saturday, hitting an intraday low of $63,177 and wiping out around $175 million in long positions. This price drop came as news of the Jane Street market manipulation surfaced, fueling bullish expectations.
What traders and investors thought was the end of the price suppression turned into fresh pain. Traders had loaded up heavily after news broke that Jane Street had been dumping BTC every day around 10 a.m. EST to cap the price.
The crypto circles saw some midweek bullish excitement with many traders anticipating a Bitcoin price recovery. After all, it was the exposure of one of the forces suppressing the price.
This was the reason for the 6%+ rally on Wednesday. However, those expectations did not last long, judging by the retracement since then. Bitwise ETF advisor Jeff Park even said were it not for Jane Street’s manipulation, Bitcoin may have reached $150,000 by now.
Investors figured the lawsuit information concerning Jane Street’s trading malpractices means freer price action. Longs piled in as traders anticipated prices to break higher. Unfortunately, Bitcoin price failed to hold the bullish steam, and price cracked late Friday, dropping to $66,000. On Saturday, the BTC price further dropped to $63,000.
Fresh data from CoinGlass clearly shows the bloodbath. In the last 24 hours, total liquidations exceeded $186 million, with longs bearing the bulk of the losses. Roughly $157 million in longs were liquidated (86% of the total liquidations today).
BTC price slid to around $63,000, down nearly 4% in the session. Open interest stayed chunky at $44 billion, but funding rates flipped negative across the majors, with Binance at -0.008% and Bybit similarly negative.
The 24-hour long/short ratio dipped below 1. It means shorts gained the edge in the frenzy as heavy long liquidations clustered during the plunge, in a classic over-leverage flush-out.
The Jane Street expose’s subsequent hype, but the narrative reversal trapped the new buyers who bet on freedom from suppression. The lingering question now is, why did the Bitcoin price crash despite the exposure of one of the largest financial crimes in history? The answer takes us to the Middle East.
In addition to the already fragile markets, Iran-US tensions once more escalated, and crypto felt it quickly. U.S officials warn the attacks could continue for days or even weeks.
Air defense systems intercepted an Iranian missile over Dubai Marina in the United Arab Emirates less than a day after the war began, and the conflict continues to impact the region. Authorities have begun evacuating people from the Burj Khalifa.
The entire crypto market dropped 2.7% to $2.28 trillion, as BTC’s market cap shrank to $1.28 trillion. Top CryptoQuant analyst Darkfost flagged panic selling in derivatives, as sell volume spiked to $1.8 billion in one hour at peak fear. Derivatives pressure index tanked from 30% to 18%, which is straight bear territory.
According to Darkfost, this type of imbalance reflects clear seller dominance and rising short-term risk aversion. In this environment, market conditions typically become more volatile and less predictable.
Geopolitical heat keeps risk assets, including BTC price, in a vice as markets hate uncertainty, and missiles flying do not help sentiment.
The bulls have not given up yet, but at the same time, the coast is not clear as longs keep getting liquidated amid negative Middle East news. The Jane Street saga showed how fast hype flips to trap, and adding geopolitical escalations to the mix ensures BTC price stays choppy, even without the prior culprit’s involvement.
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