Bitcoin Drops 4.97% to $104,945.58 Amid Geopolitical Tensions and Fed Hawkishness

Bitcoin experienced a significant decline on Thursday, falling below the $105,000 mark. This drop was influenced by a combination of heightened geopolitical tensions and a hawkish stance from the Federal Reserve, which collectively increased market risk aversion. The cryptocurrency settled at $104,945.58 on the USDT market, marking a notable decrease from its previous levels. The volatility in Bitcoin's price was further exacerbated by geopolitical events, with the cryptocurrency briefly returning above the $105,000 threshold following the formal acceptance of a ceasefire proposal brokered by the United States in the Israel conflict. This event capped a tumultuous 48-hour period for the cryptocurrency, highlighting its sensitivity to global political developments.

On June 24, Bitcoin's price dropped below $105,000, trading at $104,997 with a 24-hour gain narrowed to 3.73%. This price movement was observed across various markets, including the OKX market, where Bitcoin was trading at $105,049.30 per coin. The cryptocurrency's price fluctuations were influenced by a range of factors, including geopolitical tensions and market sentiment. The cryptocurrency's price drop was also influenced by U.S. airstrikes on Iranian nuclear sites. Bitcoin briefly fell to $98,200, erasing about $40 billion in market value before rebounding to around $101,000. Despite this significant 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 and reinforcing Bitcoin's role as a digital store of value during global uncertainty.

The options market data provided further insights into investor sentiment. 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 cryptocurrency's price movements were also influenced by broader market trends. On June 19, Bitcoin remained below the $105,000 mark early Thursday, reflecting the overall market sentiment. The global crypto market cap stood at $3.27 trillion, indicating a stable but cautious market environment. The price drop was also influenced by the broader market trends, with Bitcoin's price falling to 105,989.41 USDT, reflecting a daily decline of 4.97%.

In summary, Bitcoin's price drop below $105,000 was influenced by a range of factors, including geopolitical tensions, the Federal Reserve's hawkish stance, and market sentiment. Despite the price fluctuations, investor optimism remained high, as reflected in the options market data. The cryptocurrency's role as a digital store of value during global uncertainty was reinforced by the strong engagement from market participants.