Bitcoin dips below $100K as Iran strikes US bases in Kuwait

Bitcoin fell as low as $99,200 on July 18 after Iran's Islamic Revolutionary Guard Corps struck US military bases in Kuwait, triggering more than $700 million in liquidations across crypto derivatives exchanges.

"Geopolitical shocks of this magnitude force a rapid deleveraging in crypto markets, where open interest has been near all-time highs," Nina Volkov, a crypto macro analyst, said. "The $100,000 level acted as a liquidity magnet — once it broke, stop-loss cascades accelerated the move."

The liquidation wave hit $712 million across centralized exchanges in the 12 hours following the strikes, with long positions accounting for 83 percent of the total, according to Coinglass data as of 06:00 UTC. Bitcoin has since recovered to $101,400, regaining the six-figure threshold within four hours of the initial drop. Open interest fell 8 percent to $38.2 billion, while the funding rate flipped negative for the first time in three weeks, signaling a shift in market positioning.

The escalation marks the eighth consecutive night of US strikes on Iranian military targets after a ceasefire collapsed last week. Oil prices climbed more than 4 percent on Friday to their highest in over a month, adding to the risk-off tone across global markets. Bitcoin's next support sits at $98,000, a level tested twice in the past month, with resistance at $105,000.

$700M in Liquidations Reshape Positioning

The liquidation event was the largest single-day deleveraging since April, when a similar geopolitical flash crash wiped out $850 million in positions. Binance accounted for $312 million of the total, followed by OKX at $198 million and Bybit at $145 million, Coinglass data show. The concentration of liquidations on centralized exchanges reflects the high leverage still embedded in the system despite a year of declining funding rates.

The swift recovery above $100,000 suggests the dip was driven by forced selling rather than a structural shift in demand. Spot ETF flows remained positive on the day, with the US spot Bitcoin ETF complex recording $124 million in net inflows as of the July 17 close, according to Bloomberg data. The iShares Bitcoin Trust (IBIT) led with $89 million in inflows.

Geopolitical Risk and the Macro Backdrop

The US and Iran have intensified attacks since an interim ceasefire deal collapsed last week. Iran struck Kuwait's Camp Arifjan and Ali Al Salem Air Base, while also targeting sites in Bahrain and Jordan, according to Iranian state media. Kuwait Petroleum Corp. reported significant damage to one of its oil facilities. The US State Department issued a worldwide travel alert for Americans abroad, citing "the potential for unforeseen escalation."

The conflict has disrupted shipping through the Strait of Hormuz, which handles about one-fifth of the world's oil supply. The US said it is enforcing a naval blockade, while Iran said it is targeting vessels that violate its navigation rules. Oil's 4 percent rally added to inflation concerns that have kept the Federal Reserve on hold, with fed funds futures pricing no rate cut before November.

What to Watch

Bitcoin's ability to hold above $100,000 in the coming sessions will depend on whether the geopolitical situation escalates further. A breach below $98,000 could trigger another wave of liquidations, with Coinglass data showing $1.2 billion in long positions clustered between $97,000 and $100,000. On the upside, a de-escalation or ceasefire announcement could fuel a short squeeze toward $108,000, where $680 million in short positions are concentrated.

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