Tensions in the Middle East pushed down BTC during the first half of Asia trading hours Wednesday.
The CoinDesk 20, a measure of the most liquid digital assets, had its worst drop in weeks.
Bitcoin {{BTC}} rose above $61,500 in Asian morning hours Wednesday after sliding to as low as $60,300 late Tuesday as a Middle East conflict grows, denting hopes for a rally in the assetâs historically most bullish month.
Iran fired about 200 ballistic missiles at Israel on Tuesday, threatening a fresh round of attacks as Prime Minister Benjamin Netanyahu vowed to retaliate. The strike was in response to Israel first carrying out a series of attacks on Lebanon in the past weeks.
BTC fell the most in over a month, while gold rose, with the drop reaching 6% at one point and 24-hour losses at 3.5%. That was the worst start for the assetâs historically most bullish month, Presto Research traders wrote in a note Wednesday.
Polymarket bettors are giving a 49% chance that Israel will retaliate against Iran by the end of the week.
âHistorically, October has been a strong month for BTC with only two losing years out of the last 11,â Presto said. It pointed out goldâs outperformance in the past 24 hours as a measure of the different maturity levels of both assets.
âLast nightâs BTC price action (BTC -4% vs. gold +0.8%) in the aftermath of Iranâs attack in May puzzling, esp. considering BlackRockâs recent pitch for BTC as a risk-off asset similar to gold,â researchers led by Peter Chung wrote. âThe reality is that the difference in these two assetsâ short-term price actions reflects their different maturity phases.â
The broad-based CoinDesk 20 (CD20) fell 4.7%, its worst drop in recent weeks.
âGold is a much more mature asset, with a 5,000 year history as a store of value, so thereâs not much room left for incremental network effects. BTC, on the other hand, shares the same attributes that make gold a good store of value (better in many cases), but with only 15 15-year history. This means itâs in the early stages of mainstream adoption, and its narrative is still poorly understood,â they added.
Dogecoin (DOGE) led losses among major tokens with an 8% haircut over the past 24 hours, CoinGecko data shows, with XRP (XRP), Solanaâs SOL, BNB Chainâs BNB and ether (ETH) losing as much as 6%.
Smaller tokens with a market cap under $2 billion fared worst, with Sei Networkâs SEI, memecoin floki (FLOKI) and Starknetâs STARK falling as much as 16%.