The broader crypto market crashed with the Bitcoin (BTC) price dropping 2% taking a dip to the support levels of $65,500 again. Following Israel’s attack on Iran’s military targets, the altcoins are seeing even greater pullback with Ethereum, BNB, SOL, and XRP falling by 3-6% each. The geopolitical uncertainty is once again sending tremors across the crypto market and other risk-ON assets.
Crypto Market Crash Following Israel’s Attack on Iran
In early Saturday morning, Israel’s military launched “precise strikes” on Iran’s military bases while escalating tensions in the Middle East. Several strong explosions were heard in Iran’s capital city of Tehran as per media reports.
This development was enough to trigger a crypto market crash dragging Bitcoin and altcoins lower. However, market analysts believe that this crash is likely to be short-term. Earlier this year in April, during Israel’s first strike on Iran, the BTC price plunged more than 4% in a day, however, it quickly recovered in just four hours.
The impact is stronger in the altcoin space with Ethereum (ETH) price falling another 3% to $2450 levels and extending its weekly losses to more than 7.68%. On the other hand, the SOL price is down 6.3% at press time slipping all the way under $165. Solana has been an outperformer against BTC and other altcoins with 11% gains over the past month.
Furthermore, market analysts show that the ALT/BTC pair has touched a new low earlier today. Crypto analyst Benjamin Cowen said that there’s a possibility of altcoins falling even further in the coming months.
#ALT / #BTC pairs put in a new low for the cycle today.
The altcoin reckoning never ended.
The only thing that ended was peoples’ patience to watch it play out. pic.twitter.com/mRvzFPa0Iq
— Benjamin Cowen (@intocryptoverse) October 26, 2024
Tether Investigation Plays Spoilsport for Bitcoin and Altcoins
Reports of the US DOJ launching an investigation into Tether is another reason for the crypto market crash today. However, the USDT stablecoin issuer has clearly refused this fresh set of allegations calling it irresponsible reporting from WSJ.
However, the report has certainly put some dent as Tether (USDT) lost its USD peg and is trading 0.11% down at press time at $0.9983. Tether (USDT) is the largest stablecoin with a $120 billion market cap and has been instrumental in deciding the market movements over the past few years. Some market analysts believe that Tether is too big to fail at this point. Hilary Allen, a law professor at American University who studies digital assets, said:
“For the crypto industry and crypto writ large, I do think Tether is too big to fail. “If Tether were to go to zero tomorrow, it would be disastrous for the crypto economy.”
Jeff Dorman, chief investment officer at Arca, on the other hand, believes that the market has become immune to such regulatory developments. He added:
“We won’t really know until next week whether or not this has a longer-term effect on the market, but I would guess it has very little long-term effect, given the market has become immune to regulatory tape bombs”.
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