Bitcoin Price Braces for $60K as US-Iran Strikes Erase $128 Billion in Flash Crash
The "digital gold" narrative is getting put through the wringer. On February 28 2026, Bitcoin (BTC) plummeted...
Quick overview
- Bitcoin's price dropped to $63,038 amid global panic following US and Israeli military actions against Iran, resulting in a $128 billion loss in market capitalization.
- The market's decline was exacerbated by negative funding rates and significant withdrawals from Bitcoin ETFs, indicating a shift in investor sentiment.
- Despite the turmoil, Bitcoin's network remains strong, with 18% of BTC held by institutions and a record hashrate, suggesting potential resilience in the long term.
- Traders should monitor key support and resistance levels, as the market presents both risks and opportunities for strategic trading.
The “digital gold” narrative is getting put through the wringer. On February 28 2026, Bitcoin (BTC) plummeted to a midday low of $63,038, and global markets went into a full-blown panic after confirmed US and Israeli strikes against Iranian nuclear and military targets.
But let’s not forget the groundwork was already laid. The escalation has sent shockwaves through the entire crypto ecosystem, shredding a whopping $128 billion in total market capitalisation in just one hour. And for both retail investors who are still learning the ropes and institutional veterans who’ve been around the block a few times, the message is loud and clear: when war breaks out, even the most supposedly “decentralised” assets can’t escape the harsh realities of global conflict.
What Went Wrong: War, Tariffs, and Panic Selling
While the US-Iran conflict was the catalyst for the chaos, Bitcoin had already been on shaky ground. After an attempt to get back above $70,000 a few days ago fell flat, a perfect storm of factors came together to send the price tumbling by 4%:
- The US Takes Aim: The moment Donald Trump confirmed he was sending troops into Iran, the market’s risk appetite took a nosedive.
- Funding Rates Go South: Those funding rates for BTC went into the red, sinking to a whopping -6%. This shows that traders are now pretty much convinced the price is headed down further, rather than bouncing back.
- The Smart Money’s Tapping Out: This month has seen a whopping $4.5 billion sucked out of US spot Bitcoin ETFs, a clear sign that institutional investors have been in de-risk mode for some time.
Can the Bull Cycle be Saved? Looking Beyond the Headlines
Despite the bleak-looking price action, some professionals are quick to remind us that Bitcoin’s underlying structure is actually looking pretty robust. For those who can see past the current doom and gloom, here are a few key reasons why the 2026 bull cycle might not be history after all:
- The Institutions Still Have Their Hands Stuck In: Even if some institutional investors have been cashing out, nearly 18% of all BTC is still held by governments, corporations and ETFs.
- Network Health is Still Rock Solid: The hashrate just breached the 1 zetahash barrier, making the network more secure than ever in its history.
- Halving Aftermath: We’re firmly in the maturation phase of the 2024 halving now. Historically, supply crunches can take up to 24 months to show up in price, putting 2026 firmly in the expansion zone.
Bitcoin Technical Analysis: Ready or Not, Here Comes $63,276
On the 2hr chart, sellers are starting to get a little exhausted near the $63,276 demand zone. And this is a level to watch – it’s where a rising trendline meets a historical low.
- Support Levels: If the price breaks below $63,100, watch out for the next “trapdoor” levels: $61,602 and the dreaded $60,000 psychological barrier.
- Resistance: To prove that this was just a flash crash, bulls need to push the price back above the 50MA at $66,537 – and if they can clear $67,373, that’ll be a clear sign the war-induced fear has been fully priced in.
- RSI – Where Are We At?: The RSI has bounced back from 30 (oversold) into the mid-30s. Not exactly a “buy” signal yet, but it does suggest the immediate selling pressure is being absorbed.
Trading Strategy: Staying Patient in a Wild Market
This market is a graveyard for high-leverage traders, but it’s also a unique chance for those who have a solid plan.
The Bear Case: If the price closes below $63,100 on the 4hr candle, that opens up a high-probability trade toward $60,328.
The Bull Case: If Bitcoin holds the current demand zone and manages to get back above $65,749, you can expect a massive short squeeze – and possibly a price push back up to $68,000.
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