Bitcoin Slips Below $64,000 as Trump Warns of Military Action and South Korea’s Market Crashes

Things were looking up for crypto just a few days ago. ETF inflows were coming back. The Clarity Act was moving through Congress. Then Tuesday happened.

Bitcoin dropped 3.5% and Ethereum fell 4.5%, both sliding back below the levels they had been holding. BTC is back under $64,000, ETH is back under $1,900, and most of the altcoin gains from the past week have been handed back.

Three things hit at once, and none of them were easy to shrug off.

Trump told reporters Tuesday he is ready to resume military action against Iran if ongoing talks fall apart, saying negotiations had “not much time” left. Oil, which had been falling on ceasefire optimism, turned back around and climbed to around $84 a barrel. That kind of headline does not stay contained to one market. When the Middle East starts heating up again, risk appetite tends to dry up fast across the board.

Then South Korea’s stock market fell apart. The KOSPI dropped more than 8% and triggered a circuit breaker, its eighth suspension of 2026. SK Hynix, one of the world’s biggest memory chip makers and a key supplier of the high-bandwidth memory that powers AI systems, saw its US-listed shares fall nearly 12% to $139.45. When a market as closely watched as South Korea’s semiconductor sector gets hit that hard, it sends a clear signal to risk assets everywhere, crypto included.

On top of that, Bitcoin ETFs posted $11.64 million in net outflows on July 27, with BlackRock’s IBIT accounting for $8.82 million of that. It is a small number compared to last week’s $900 million in inflows, but any reversal in ETF flows after a period of improvement tends to get noticed. Ethereum ETFs went the other way, pulling in $9.23 million, led by BlackRock’s ETHA.

The forced selling that followed added up. Over $156 million in Bitcoin positions were liquidated in 24 hours, with longs taking $133 million of that hit. Crypto is also tracking gold at a 93% correlation right now, which means it is behaving like a macro risk asset. Gold fell 1.2% Tuesday, barely holding above $4,000 an ounce, and crypto went with it.

The Fear and Greed Index sits at 34, in fear territory but not yet at the kind of extreme reading that has historically marked a bottom. The $64,000 level is the one to watch. Losing it cleanly opens the path toward $62,000 and then $60,000. Getting back above $65,000 would be the first real sign that buyers are willing to step back in.

The Fed decision lands Wednesday. That is the next thing that could shift the mood in either direction.

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Sophia Cruz

Financial Writer - Asian & European Desks

Sophia is an experienced writer, reporter and newsdesk member, mostly on the financial sectors. For the past 5 years Sophia has covered a wide variety of topics such as the financial markets, economics, technology, fin-tech and trading. Sophia has been a part of the FX Leaders team since 2017 and works on producing valuable content and information for traders of all levels of experience.

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