Bitcoin Drops From $79.5K; $218M Liquidated Amid Hormuz Tensions

Bitcoin retreated from an intraday high of $79,500 to roughly $78,000 on April 23, removing about $10 billion from its market capitalization and prompting $218 million in liquidations. The decline was a 1.2% loss over 24 hours and the first daily drop since April 20.

The token reached $79,500 on Wednesday afternoon before slipping to an intraday low of $77,201 by 6 a.m. Eastern on Thursday. It later recovered briefly above $78,500 and settled near $78,000 by 1 p.m. Eastern. Market capitalization fell from about $1.58 trillion at its monthly peak to roughly $1.57 trillion during the pullback.

Derivatives activity reflected the price swing. The roughly $1,000 intraday move led to the liquidation of about $35 million in long positions and roughly $23 million in short positions on the immediate dip. Those figures were smaller than the approximately $207 million wiped out in the prior session. Across the broader crypto market, total liquidations reached $218 million, with leveraged long traders responsible for about $147 million of the total.

Traders linked the price weakening to escalating maritime tensions in the Strait of Hormuz. Commercial vessels in the area have been stranded for more than a month after confrontations over control of shipping routes. On April 23, the U.S. Navy seized an Iranian vessel hours after Islamic Revolutionary Guard Corps forces had taken control of two ships. Some analysts warned that restrictions on Iranian port revenues could prompt attacks on neighboring Gulf states.

Equity markets showed limited reaction to the naval incidents. South Korea’s Kospi and France’s CAC 40 posted modest gains while most major indexes were flat.

Bitcoin’s decline followed a short rally that pushed the price above $79,000 earlier in the week. The April 23 drop was the first 24-hour loss since April 20, when the token fell to about $73,800. Traders noted that derivatives positions were particularly sensitive to quick intraday moves, contributing to the liquidations observed.