Crypto markets slide as oil prices spike, prompting traders to increase bearish positions: Crypto Markets Today.

Bitcoin and ether tumbled sharply alongside global risk assets after rising tensions in Iran pushed oil prices higher, with derivatives data showing traders increasingly positioned for further downside. The activity points to sustained demand for downside protection rather than panic selling.

Market Moves
Bitcoin (BTC $67,326.52) surrendered much of its recent gains on Thursday, trading around $66,700—a 2.4% decline since midnight UTC. Ether (ETH) fared worse, falling 4.4% amid broad crypto market weakness fueled by risk-off sentiment.

The latest drop followed comments from U.S. President Donald Trump, who said on Wednesday evening that military action in Iran would escalate, warning, “Over the next two to three weeks, we’re going to bring them back to the stone ages where they belong.”

Oil prices surged in response, with Brent crude jumping about 10% to $108 per barrel, while U.S. equities diverged: Nasdaq 100 futures fell 1.5% and S&P 500 futures lost 1.1%. The U.S. dollar gained 0.5% to surpass 100 points.

Derivatives Insights
Derivatives activity suggests traders are bracing for further declines rather than panicking. BTC’s price drop coincided with a modest uptick in open interest across major USD- and USDT-denominated futures. Perpetual funding rates have slid to their most negative levels since March 12, signaling bearish positioning and shorting activity.

Ether’s funding rates are now the most negative since October 2025, reinforcing a strong bearish bias. Meanwhile, Solana (SOL) shows measured bearishness despite a recent overnight hack. Privacy-focused Zcash (ZEC) and ADA have seen notable declines in open interest over the past 24 hours, reflecting capital outflows.

Nearly $400 million in futures positions were liquidated due to margin shortfalls—a 17% increase compared with the previous day. Despite the risk-off environment, 30-day implied volatility indices for BTC and ETH remain stable, indicating orderly selling in spot markets rather than panic. Traders have already positioned for market weakness, consistently buying put options for downside protection. Bitcoin and ether puts remain pricier than calls across all tenors on Deribit. Block trades included demand for ether straddles, put spreads, and bitcoin call spreads.

Token Performance
The worst-performing benchmark on Thursday was CoinDesk’s DeFi Select Index (DFX), down 5.9% since midnight UTC, followed by the CoinDesk Computing Select Index (CPUS), which fell 5%.

Ethena (ENA) led the declines, dropping more than 10%, while DeFi tokens UNI, LDO, SKY, and AAVE fell between 4.2% and 6.5% during Asian and European trading hours.

Algorand (ALGO) bucked the bearish trend, rising around 0.8% as it extended its recent rally of 22% over the past week. CoinMarketCap’s “altcoin season” index dropped from 50/100 to 42/100 since March 30, highlighting sector-wide weakness.