Bitcoin Drops 2.25% Below $105,000 Amid Geopolitical Tensions

Bitcoin experienced a significant decline this weekend, with its price falling below $105,000. According to market data, the cryptocurrency's value dropped to $101,885, marking a 0.7% decrease and falling below key support levels. This downturn was part of a broader market selloff, with Bitcoin's value dropping 2.25% below the $105,000 mark, triggering market volatility. The cryptocurrency briefly fell to $98,200, erasing about $40 billion in market value, before rebounding to around $101,000. This price movement was influenced by U.S. airstrikes on Iranian nuclear sites, which heightened geopolitical tensions and led to a wave of risk aversion among investors.

Despite the price drop, data from the options market indicated that investors remained optimistic about Bitcoin's future performance. Open interest in Bitcoin options reached $51 billion, reflecting strong engagement from market participants. This level was significantly higher than Ethereum’s $17 billion, reinforcing Bitcoin’s role as a digital store of value during global uncertainty. On the largest crypto options platform, call options accounted for 59.73% of open contracts compared to 40.27% for puts. This suggested a belief in Bitcoin’s recovery despite recent geopolitical shocks. The most active contract speculated that Bitcoin could fall to $95,000 or less by June 27, while another widely held position anticipated a rise to $105,000 by July 11. These positions reflected a strategy of hedging against near-term risk while maintaining a positive view on medium-term gains.

The options market also showed a more complex and risk-managed approach from institutional investors, who were moving beyond simple holding strategies. Despite the drop below $100,000, the options market reflected confidence in Bitcoin’s future performance. This was evident in the trading volumes, which showed more balance, with 24,780 BTC traded via put options and 24,168 BTC through call options over the past 24 hours. This indicated short-term caution among traders, but also a belief in Bitcoin’s potential for recovery.

Bitcoin's price started a fresh decline below the $103,000 zone, consolidating and struggling to recover above the $103,500 resistance. The cryptocurrency settled below $105,000 on Thursday despite mounting risk aversion amid geopolitical tensions and a bullish stance by the Federal Reserve. Bitcoin's price drop below the $100,000 mark was its lowest point since May 8, and it faced a bearish pattern with a potential drop to $92,000 if it broke below $100,000, triggering a wave of long liquidations. However, the options market's data suggested that investors were prepared for this volatility and remained optimistic about Bitcoin's long-term prospects.