Bitcoin fell below $64,000 on Monday, pressured by escalating tensions in the Middle East and market jitters following China's launch of the Kimi K3 AI model.
The cryptocurrency dropped nearly 2% to $63,785 before partially recovering to around $64,000, marking a 1% decline over the last 24 hours. Other digital assets like Ether, XRP, BNB, and Dogecoin also saw minor losses. The Crypto Fear & Greed Index remained in the "Fear" zone at 29.
Heightened Middle East risks emerged after a projectile ignited a ship in the Strait of Hormuz, forcing evacuation and rescue operations. US strikes resulted in a fatality in Tabriz, and Tehran condemned attacks targeting the Darkhovin nuclear site. CENTCOM reported a US service member died during the controlled detonation of an Iranian drone in northern Iraq.
These incidents initially sent crude oil prices above $85 per barrel, before they eased to $82 following confirmation from Iran’s Foreign Ministry that international mediators proposed de-escalation measures. Tehran indicated openness to talks with Washington, conditional on national interests, reducing near-term supply concerns yet maintaining the risk of further price spikes.
Market pressure also stemmed from technology stocks after Beijing-based Moonshot AI unveiled Kimi K3, a 2.8 trillion-parameter model excelling in coding and agent-based tasks. Internal benchmarks place Kimi K3 ahead of Western competitors in frontend coding, though independent verification is pending.
The launch raised worries over Chinese AI models challenging US firms and their chip suppliers. Bitcoin’s price has closely tracked tech-heavy equity indices during recent sell-offs, exposing it as traders retreated from speculative assets. US equity funds recorded $4.8 billion in outflows for the week ending July 15, with the Philadelphia Semiconductor Index losing 8.48% and growth funds seeing $7.18 billion in redemptions.
Technically, Bitcoin needs to surpass $65,047 to confirm a stable recovery towards $67,000. A decline below $62,708 could threaten the $60,000 support level and potentially trigger further liquidations.
This material is for informational purposes and does not constitute financial advice.
