New York, February 28: Bitcoin and the broader cryptocurrency market experienced a sharp sell-off on Saturday, February 28,, as news of US and Israeli military strikes on Iran triggered a global "risk-off" sentiment. Bitcoin (BTC) plummeted nearly 4%, sliding below the critical USD 64,000 support level to reach a session low of approximately USD 63,038. The sudden downturn resulted in nearly USD 128 billion being erased from the total digital asset market capitalisation in just over an hour, reflecting investor anxiety over a potential full-scale regional war.

The price crash coincided with reports of powerful explosions in central Tehran and the announcement of "Operation Epic Fury" by President Donald Trump. While traditional stock and bond markets were closed for the weekend, the 24/7 nature of the crypto market allowed it to serve as a real-time barometer for geopolitical fear. Ethereum (ETH), the second-largest token, suffered even deeper losses, dropping 4.5% to trade near USD 1,835, while major altcoins like Solana and XRP saw similar declines. Why Is Gold Price Rising Today?

Bitcoin Price Crash

The primary catalyst for the decline is the immediate reaction of investors to move capital out of volatile "risk assets" and into perceived safe-havens like the US dollar and gold. Historically, while Bitcoin has been labelled "digital gold," it often reacts more like a high-growth tech stock during the initial stages of a military conflict.

"Markets hate uncertainty," noted a senior analyst at Pepperstone. "The reports of strikes near high-value targets in Tehran led to an immediate rush for the exit by short-term traders." This flight to safety was reflected in the surging demand for tokenised gold, such as PAXG, even as Bitcoin prices struggled to find a floor. Is Strait of Hormuz Closed? Iran’s Revolutionary Guards Bars Vessel Movement, Says Report.

Massive Liquidations and Derivative Pressure

The speed of the price drop was accelerated by a "liquidation cascade" in the derivatives market. According to data from CoinGlass, over USD 522 million in leveraged positions were wiped out in 24 hours, with nearly 86% of those being "long" positions (bets on rising prices).

When Bitcoin’s price fell below USD 65,500, it triggered automated sell orders for thousands of traders who were using high leverage. This created a domino effect, where selling led to more liquidations, further depressing the price. Spot trading volume remained relatively low compared to the massive USD 76 billion in futures volume, indicating that this move was largely driven by forced closures rather than organic long-term selling.

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(The above story first appeared on LatestLY on Feb 28, 2026 11:50 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).