Israel stepped up its defense alert level recently as reports surfaced about possible US strikes targeting Iran. This move reflects growing worries that Iran might retaliate against Israel, fueling unease across global markets and shaking the cryptocurrency sector.
Energy Minister Eli Cohen made it clear on July 23 that Israel is prepared to respond firmly to any aggression from Iran. The heightened alert followed escalating US-Iran tensions that have persisted since February, including joint US-Israeli operations against Iranian assets. These actions triggered a cycle of tit-for-tat strikes and diplomatic deadlocks.
Strait of Hormuz and Bitcoin's price swings
The tight choke point of the Strait of Hormuz, through which about 20% of the world’s oil flows, has become a hotspot for recent skirmishes. Such clashes raise fears of a broader conflict capable of disrupting energy supply chains globally. This risk ripple also weighs heavily on inflation expectations and financial markets.
Bitcoin’s reaction to the ongoing conflict has been telling. Early in 2026, it traded stably around $104,000 to $106,000 but declined sharply during spikes in military tension. At one point, the price dropped near $63,000 a plunge of roughly 40% from recent peaks. This pattern shows Bitcoin acting more like a risk asset than a haven amid geopolitical turmoil, reflecting its close link to market sentiment.
