Crypto Liquidations Near $1B After US Strikes Iran

$934 Million in Liquidations: The Catalyst

Crypto liquidations hit $934.24 million in the 24 hours after the US launched fresh strikes inside Iran. The flush wiped out roughly 167,400 trader accounts as leveraged longs collapsed. CoinGlass data shows longs made up 93% of the total. Short sellers were largely spared.

The heaviest damage landed on Bitcoin (BTC) and Ethereum (ETH). BTC liquidations reached $363 million, ETH liquidations $240 million. The largest single order, a $15.34 million BTC long, closed on Hyperliquid.

The Simple Read: War Fears Trigger Leverage Washout

Risk assets across stocks and oil moved sharply. Brent crude climbed as traders priced in supply concerns around the Strait of Hormuz. The flush cleared out long bets built during the prior ceasefire rally. President Donald Trump had first questioned a deal earlier in the week, and after a Wednesday cabinet meeting he confirmed talks had stalled. He said Tehran was “negotiating on fumes” and warned the US might “finish the job” if no agreement materialized.

Why It Matters Now: Leverage Positioning Was the Trap

The skew toward longs points to derivatives books that had absorbed the prior week’s ceasefire optimism. Traders added leverage on the long side. Bitcoin’s recent leverage ratio decline had already flagged thin positioning. The better market read is that this flush is a positioning clean-out, not a fundamental repricing of crypto.

The Mechanism: From Ceasefire Hopes to Hormuz Risk

The sell-off began after the US Central Command confirmed strikes against Iranian targets. Forces hit four one-way attack drones near the Strait of Hormuz. A ground control station at Bandar Abbas was also destroyed. Kuwait separately activated air defenses against incoming missiles and drones.

The escalation arrived only days after both sides hinted at a ceasefire framework. Trump’s blunt language reversed a market mood that had built on his earlier Iran pledge to wind the conflict down. Iranian state media reported no casualties from the action.

Practical rule: Leverage positioning built on ceasefire optimism is the first to wash out when geopolitical reality shifts. The same dynamic played out during the $1.7 billion liquidation cascade earlier this year.

Affected Assets: BTC, ETH, and Broader Crypto

Bitcoin sank below $73,000 during the rout. The drop extended a slide that began when Trump first questioned a deal. Ethereum followed, with both tokens under pressure from risk-off flows.

Asset	Liquidations (24h)	Move Trigger
Bitcoin (BTC)	$363M	US strikes on Iran, stalled talks
Ethereum (ETH)	$240M	Broader risk-off, long squeeze
Total market	$934M	93% longs, 167,400 accounts flushed

The next leg depends on whether Washington and Tehran return to the table. A second round of strikes inside three days has narrowed the runway for diplomacy. Any disruption to shipping through the Strait of Hormuz would feed straight into oil and risk-off flows. The US has already widened pressure through its Operation Economic Fury crackdown targeting Iran’s digital asset network.

The Keystone: Funding Rates and Open Interest

For crypto, the $1.7 billion liquidation cascade earlier this year showed how quickly leverage can rebuild. Traders will watch funding rates and open interest over the coming sessions. The data will show whether sentiment is resetting or simply reloading the long side. With Bitcoin’s earlier Hormuz-driven price slide already on the books, another headline move would test the $70,000 floor.

Decision Point: What Confirms or Weakens the Setup

The next concrete catalyst is whether the US and Iran return to talks. If diplomacy resumes, leveraged longs will likely reload – and funding rates will turn positive again. If strikes continue, expect further risk-off and potential tests of $70,000 on Bitcoin.

Risk to watch: The Strait of Hormuz disruption. That scenario would spill into broader markets, with crypto acting as a high-beta proxy for risk appetite – not a safe haven.

For trading desks, the key metric is open interest on BTC and ETH futures. If it rebuilds quickly while funding rates stay negative, it signals dip buyers entering with firm conviction. If open interest stagnates, the market is waiting for a diplomatic resolution.

Bottom line: The flush cleared a crowded trade. The next move will be driven by whether the geopolitical overhang on Hormuz intensifies or fades. The positioning reset gives the market a cleaner slate – but the catalyst remains in Washington’s and Tehran’s hands.

Crypto Liquidations Near $1B After US Strikes Iran

$934 Million in Liquidations: The Catalyst

The Simple Read: War Fears Trigger Leverage Washout

Why It Matters Now: Leverage Positioning Was the Trap

The Mechanism: From Ceasefire Hopes to Hormuz Risk

Affected Assets: BTC, ETH, and Broader Crypto

The Keystone: Funding Rates and Open Interest

Decision Point: What Confirms or Weakens the Setup

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