Bitcoin Slumps to Five-Week Low Following US Airstrikes on Iran; $1 Billion Liquidated

Bitcoin faced heavy selling pressure on Thursday, tumbling to a five-week low of $72,800. The sharp decline followed news of fresh U.S. airstrikes in Iran, which spooked global investors and prompted a rapid exit from risk assets.

The sudden downward spiral triggered cascading liquidations, wiping out nearly $1 billion across the broader digital asset market within hours. Traders who were heavily leveraged for higher prices found themselves caught in a violent squeeze as global geopolitical anxieties escalated.

The geopolitical shock worsened an already weak framework for digital assets. Institutional investors continue to rapidly pull money from the market. Data shows that U.S. spot Bitcoin exchange-traded funds (ETFs) recorded their eighth consecutive day of net negative flows.

This multi-day selling streak pulled more than $2 billion out of the asset class. The massive institutional withdrawal has eliminated the liquidity buffer that kept Bitcoin near record highs earlier this month.

Regulatory Stagnation

Compounding the war headlines and fund outflows is a growing frustration with lawmakers in Washington. The broader market sentiment remains deeply subdued due to a total lack of progress on critical U.S. crypto legislation.

Both the Digital Asset PARITY Act and the CLARITY Act have stalled in Congress. Investors had hoped these bills would provide a clear legal framework for digital assets, but the political gridlock is forcing fund managers to stay highly cautious.

Support Levels to Watch

$70,000 mark is a key psychological and technical floor. If selling intensifies and breaks this level, it could trigger another round of automated stop-loss orders. On the upside, experts believe a sustained move back above $75,000 is necessary to stabilize the price in the short term and bring buyers back to the table.

"Bitcoin came under fresh selling pressure following the U.S. airstrikes on Iran, triggering nearly $1 billion in liquidations across the crypto market. Additionally, outflows from Bitcoin ETFs continued for the 8th straight day, pulling out over $2 billion from the asset. The broader sentiment also remains weak due to a lack of progress on key U.S. crypto legislation, including the Digital Asset PARITY Act and the CLARITY Act, which keeps investors cautious. Currently trading at $72,800, BTC must defend the $70,000 level to avoid further downside. A sustained move above $75,000 could help stabilise the price in the short term," said Akshat Siddhant, Lead quant analyst, Mudrex.

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