Ethereum falls sharply after Middle East situation intensifies

On Sunday, bitcoin fell below the $100,000 mark for the first time since May, while Ethereum plunged nearly 10% to levels below $2,200. The drop came after the US President announced a military operation in the Middle East. These events caused concern among investors and accelerated the outflow of funds from risky assets, including cryptocurrencies.

According to Caroline Mauron, co-founder of Orbit Markets, a liquidity provider for cryptocurrency derivatives, markets are intensely monitoring geopolitical events.

Cosmo Jiang, general partner at Pantera Capital Management, also noted the impact of the situation on cryptocurrency markets. According to him, the sell-off in crypto during the week and over the weekend was mainly caused by geopolitical risks. As the expert noted, bitcoin “tends to lead the market out of a bounce” during periods of uncertainty like this.

Still, on Monday, the major cryptocurrency was able to recoup some of its losses and rise above the key $100,000 level. Meanwhile, Ethereum also managed to recover to some extent after a sharp drop. However, for now, both digital currencies remain at values below those recorded before the Middle East tensions escalated.