Bitcoin collapsed to $60,000, giving up most of the gains it made after the Fed rate cut

• Bitcoin is down 3% in the past 24 hours, while major altcoins such as SOL, AVAX, DOT, and NEAR have posted losses of between 5% and 10%.
• Swissblock analysts wrote that “war news” rarely has a sustained negative impact on asset prices.

Cryptocurrencies fell during Tuesday’s session in the United States as headlines of escalating tensions in the Middle East prompted investors to flee risky assets.

Bitcoin (BTC), the largest digital asset by market capitalization, rose to around $64,000 during European hours before quickly falling to $62,500. As reported by Axios The White House has indications that Iran is preparing for an imminent ballistic missile attack against Israel. This was followed by another drop to $61,000 when the IDF paid $61,000. He said That Iran fired missiles at the country.

The late afternoon bearish move took Bitcoin’s price to just above the $60,000 level, having now given up almost all of the gains it saw after the US Federal Reserve triggered a massive rally with a 50 basis point interest rate cut in the middle of… September.

The market-wide digital asset standard CoinDesk 20 Index Down about 5% over the same period, Ethereum (ETH) fared slightly better with a 3.8% loss of just over $2,500. Major altcoins suffered deeper declines, with Solana (SOL), Polkadot (DOT), Avalanche (AVAX), Uniswap (UNI), Render (RNDR), Polygon (POL), and Hedera (HBAR) suffering declines of -5%. 10%.

Major US stock indexes opened lower today, with the S&P 500 and the tech-heavy Nasdaq down 1% and 1.7%, respectively, in the final hours of the session. Gold jumped 1% to $2,690 an ounce and approached its record high above $2,700 hit last week, while West Texas Intermediate crude rose 3% to more than $70 a barrel.

The divergent price action of gold and Bitcoin highlighted the leading digital asset’s high correlation with riskier assets such as stocks, not to mention gold fulfilling its traditional role as a safe haven asset. K33 Research noted in a report released on Tuesday that the 30-day rolling correlation between BTC and the S&P 500 Index is now near yearly highs of 0.62.

Bitcoin’s decline on Tuesday was also reminiscent of price action at the beginning of the current unrest in the Middle East nearly a year ago today, not to mention similar instances earlier this year. April and July When crypto assets fell in response to news headlines from that region.

Swissblock analysts reiterated their bullish outlook for digital assets in a Telegram market update, saying that “war news” like the one weighing on markets today rarely has a sustained negative impact on asset prices.

“We remain bullish,” they added.

Update (October 10, 17:55 UTC): Story updates with the latest price action. Adds analyst comment.

Update (October 10, 20:45 UTC): Story updates with the latest price action.