Bitcoin News Today: Bitcoin Falls 4% Amid $144.8M Liquidations, Geopolitical Tensions Spur Volatility Warnings

Bitcoin’s price fell sharply in early July 2025 amid a wave of leveraged position liquidations and heightened geopolitical tensions, with analysts warning of prolonged volatility. After reaching an all-time high of $123,000 in mid-July, Bitcoin plunged to $115,000 as traders unwound long positions, triggering a cascade of selling pressure. Derivatives markets reported $144.8 million in liquidations within 24 hours, with $128.77 million attributed to long positions. The drop pushed the asset below the $116,000–$117,000 support level, a key threshold historically associated with bearish momentum [1]. CoinGlass data highlighted a surge in open interest on Binance, signaling potential price swings as the market retests the $115,000 support level [2]. Analysts from COINOTAG noted that while the correction aligns with typical patterns during bull runs, the current environment’s fragility—driven by overlapping macroeconomic and geopolitical factors—suggests further instability [3].

The selloff coincided with a broader crypto market downturn, with Ethereum and Solana also experiencing significant declines. Funding rates for major tokens turned negative, reflecting a shift toward bearish sentiment, while implied volatility spiked before stabilizing as conflicts in the Middle East eased [4]. The U.S. military’s involvement in the region and subsequent ceasefire negotiations created a rollercoaster for global markets, with Bitcoin losing over 4% of its value and Ethereum dropping more than 8% during peak volatility. Although the asset rebounded temporarily, derivatives data revealed a persistent put-skew in short-term BTC options, underscoring lingering downside risks [5].

Regulatory developments failed to offset immediate market jitters. The U.S. House’s passage of the CLARITY Act and the CBDC Anti-Surveillance State Act, alongside the signing of the GENIUS Act into law, aimed to clarify stablecoin regulations and boost institutional adoption. However, these measures could not counter the impact of Trump’s aggressive tariff policies and the U.S. military’s Middle East interventions, which have historically influenced crypto price swings [6]. The Fed’s neutral stance on interest rates further compounded uncertainty, as traders navigated a landscape where geopolitical shocks often outweighed fundamental drivers. For instance, the threat of tariffs on China and Europe triggered an intraday selloff in July, sending Bitcoin below $110,000 before a partial recovery [7].

Looking ahead, derivatives markets are pricing in elevated volatility, with short-term BTC options skewed toward out-of-the-money puts—a sign of bearish hedging preferences. Analysts caution that the U.S.-China trade talks and Middle East tensions will remain pivotal, though the CLARITY Act’s implementation timeline and broader implications remain unclear [1]. Meanwhile, Bitcoin’s strong correlation with U.S. equities, particularly the S&P 500 and Nasdaq-100, underscores the asset’s sensitivity to macroeconomic shifts. A relief rally followed the U.S.-Vietnam trade agreement, mirroring equity market moves, but renewed trade frictions quickly curbed risk appetite [5].

Institutional activity added complexity to the narrative. The launch of the first U.S. crypto reserve—including Bitcoin, Ethereum, XRP, Solana, and Cardano—initially disappointed traders, causing a 5% drop in Bitcoin. While the initiative signaled growing institutional acceptance, mixed market reactions highlighted skepticism about its scale. Derivatives metrics, including inverted volatility term structures and negative funding rates, indicated a focus on hedging against further declines [7].

Source: [1] [Block Scholes x Bybit Crypto Derivatives July 25] [https://example.com/1]

[2] [BTC/USDT on TradingView] [https://example.com/2]

[3] [COINOTAG Expert Analysis] [https://en.coinotag.com/bitcoin-price-dips-amid-liquidations-and-geopolitical-tensions-potential-for-future-volatility-2/]

[4] [Block Scholes x Bybit Crypto Derivatives June 19] [https://example.com/4]

[5] [Block Scholes x Bybit Crypto Derivatives July 10] [https://example.com/5]

[6] [Block Scholes x Bybit Crypto Derivatives June 27] [https://example.com/6]

[7] [Block Scholes x Bybit Crypto Derivatives June 27] [https://example.com/7]