Bitcoin falls below $65,000: What’s driving the latest crypto crash?

Bitcoin prices dropped below $65,000 on Saturday as the cryptocurrency market reacted sharply to reports that Israel and the United States had launched military attacks against Iran on Saturday.

The sudden escalation in geopolitical tensions triggered a wave of risk-off sentiment, where investors sell off volatile, high-risk assets like crypto and seek safer alternatives such as gold. As a result, Bitcoin was down nearly 3% at 12:58 pm (UTC) on Saturday, slipping toward the low of $64,000.

When Bitcoin falls, the rest of the crypto market usually follows. The pattern played out again, as other major tokens like Ethereum (ETH) and Solana also declined alongside.

How much other crypto assets fall today?

The world's second largest cryptocurrency, Ethereum or Ether, saw an even larger decline, trading at around $1,869 after dropping $60.69, or roughly 3.14% amid broader market selloff.

Meanwhile, Solana was trading at $78.94 during the same time, marking a decline of almost 4% over the past 24 hours.

Before today's escalation in geopolitical tensions, Bitcoin was already in a months-long downtrend from its October 2024 all-time high above $126,000. Hence, the latest sell-off did not trigger a correction, it further accelerated it.

What should crypto investors do?

Sharp corrections like today's selloff can unsettle even seasoned investors. According to Piyush Jhunjhunwala, Founder & CEO, Stockify, the latest crypto slide marks one of the steepest single-day drops seen in the past few months.

“These drops create tremendous amounts of fear, and investors are selling off their high beta positions,” he said.

He notes that as geopolitical tensions or future conflicts emerge, bouts of volatility may continue to pressure prices. “However, there are many instances in history where knee-jerk selling creates a great opportunity for disciplined long-term position holders after volatility decreases and calm returns to the marketplace,” Jhunjhunwala added, urging investors to hold the asset.

In this backdrop, the crypto expert advises long-term crypto investors to focus on risk management, keeping leverage in check, and focus on maintaining disciplined/long-term positions as opposed to selling in a panic due to external events that may lead to significant decreases in price.

Will gold benefit from Bitcoin’s latest drop?

Since most gold instruments do not trade over the weekend, markets will have to wait until Sunday night, when the Asian trading resumes, to gauge how gold responds to Saturday's development.

Commenting on the likely opening trend for precious metals such as gold and silver on Monday following the escalation in US-Iran tension, Anuj Gupta, a SEBI-registered market expert, told Mint, “The escalation in the US-Iran war buzz is expected to fuel uncertainty, and investors are expected to look at gold and silver as a safe-haven asset. We expect a gap-up opening for precious metals.”