Kuwait base attack hurts Americans as bitcoin slides below $73,000

A missile attack on a US air base in Kuwait wounded several American service members Thursday, sending bitcoin below $73,000 as investors fled risk assets amid a fresh escalation in US-Iran hostilities that threatens to unravel a tentative ceasefire deal.

"The combination of geopolitical escalation and the collapse of Strategy's cash runway creates a dual shock for crypto markets," said Markus Thielen, head of research at 10xResearch.

Bitcoin dropped as low as $72,800, its weakest level in six weeks, extending losses after spot ETF outflows reached $1.07 billion this week. The largest daily exit since Jan. 29 came Wednesday, with BlackRock's iShares Bitcoin Trust alone losing $527.8 million in its second-worst outflow day since inception.

The attack threatens a tentative 60-day memorandum of understanding between Washington and Tehran that would have extended the ceasefire and reopened the Strait of Hormuz, through which 21 percent of global oil trade flows. Treasury Secretary Scott Bessent said Thursday that "nothing is going to be on the table" until Iran agrees to reopen the waterway and surrender its highly enriched uranium stockpile.

Escalation Despite Truce

The Islamic Revolutionary Guard Corps claimed responsibility for the strike on the Kuwaiti base, calling it retaliation for US airstrikes on an Iranian launch site in Bandar Abbas. US Central Command said Kuwaiti forces intercepted an Iranian ballistic missile during the same exchange, while American forces shot down five Iranian one-way attack drones that posed a threat to shipping in the strait.

The exchange marked the second time this week US forces struck Iranian targets. On Monday, American warplanes hit missile launch sites and Iranian boats laying mines in the Strait of Hormuz. Iran responded by launching two salvos of cruise missiles at the United Arab Emirates earlier this month, injuring three people.

President Donald Trump entered the Situation Room Friday for a final decision on the Iran deal, outlining conditions that include Iran's commitment to never pursue nuclear weapons and the immediate opening of the Strait of Hormuz without tolls. Iran's Fars news agency dismissed parts of Trump's statement as "a mixture of truth and lies," saying no such clauses appear in the text of the agreement.

Bitcoin's Fragile Setup

For crypto markets, the geopolitical turmoil compounds an already deteriorating technical picture. Bitcoin ETF outflows have reached $1.07 billion this week, on track to surpass last week's $1.26 billion. The $74,000 level, which had served as support for the past month, now becomes resistance, according to Sean Bill, CIO and co-founder of Bitcoin Standard Treasury Company.

"If the market begins to consolidate below $74,000, bears will look for a retest of the February lows just above $60,000," Bill said. Strong support exists at that level with the 200-week moving average coming in just above it at $61,500, he added.

Adding to the pressure, Strategy's cash runway to cover its $1.7 billion in annual dividend obligations on its STRC preferred equity instrument has collapsed to 6.1 months, down from the 16 months Thielen previously forecast. The company holds 843,738 bitcoin acquired over nearly six years at a deployed cost of $65 billion.

"When that symbol starts selling instead of buying, the story changes," Thielen said, referring to founder Michael Saylor's recent acknowledgment that Strategy will "probably sell some bitcoin soon."

The last time the Strait of Hormuz faced a sustained closure during the 2019 tanker attacks, oil prices spiked 15 percent over six weeks while risk assets broadly sold off. The current disruption has already pushed gasoline prices higher in the US, adding political pressure on the Trump administration ahead of the midterm elections.

This article is for informational purposes only and does not constitute investment advice.