Bitcoin slipped below $78,000 and touched an intraday low of $77,614, according to Bitstamp data, as traders reacted to rising fears of renewed U.S. and Israeli military action against Iran. The move erased bitcoin’s gains for the month and pushed its market capitalization down to $1.56 trillion, more than $40 billion below the $1.6 trillion level seen on Thursday. After the drop, the asset recovered modestly and traded around $78,000.
The decline extended a broader pullback that began after bitcoin reached $82,000 on May 14. From that level, the asset has lost about $4,000, while its 24-hour loss reached 3.2%. The sell-off came as geopolitical risk drove a sharp change in risk appetite, sending capital out of volatile assets and into a more defensive posture.
Military escalation fears rattled markets
A New York Times report said any escalation could involve a two-track U.S. military response: intensified precision airstrikes on Iranian command-and-control infrastructure and highly specialized ground operations aimed at securing and removing enriched nuclear material stored deep inside underground facilities in Isfahan. Tehran responded by saying it would deliver a “well-deserved response” to any aggression.
Israeli defense officials also moved closer to a wartime stance. Domestic media reports said the Israel Defense Forces were preparing assets for a campaign that could last several weeks. The report added that the chances of a return to combat had increased after the U.S.–China summit ended, while critics warned that such a move could bring heavy American casualties and a fresh jump in oil prices. By late Friday, May 15, both Brent crude and West Texas Intermediate were trading above $105 per barrel.
Altcoins dropped as liquidations piled up
The sell-off spread quickly across the wider crypto market. Among large-cap coins, HYPE posted the steepest decline, falling 10.5%. ZEC and LINK each dropped 6.4%, while XRP, which had rallied after progress on the CLARITY Act bill on May 14, fell 4% to $1.41. Most altcoins recorded 24-hour losses of more than 3%, pulling their combined market capitalization from just above $1.1 trillion to nearly $1.05 trillion.
Derivatives markets saw a sharp wave of forced unwinds. In the past 24 hours, nearly $700 million in leveraged positions were liquidated, with long positions making up about 95% of the total. That put long liquidations at roughly $666 million, showing that bullish traders absorbed the bulk of the damage as the market fell.