Crypto retreats after Hormuz airstrikes as long liquidations climb to $897 million

Bitcoin slipped to its lowest level since April 13 on Thursday, while ether fell below $2,000, as U.S. airstrikes in the Strait of Hormuz unsettled global markets and intensified risk-off flows across digital assets.

BTC traded near $73,400, down roughly 1.2% on the day after briefly touching a multi-week low in early trading. Ether underperformed, dropping 1.5% and breaking below the $2,000 level for the first time since late March.

The move followed a sharp rise in oil prices after the strikes raised concerns over potential supply disruptions. Crude climbed from $92 to as high as $96 per barrel before easing to around $94, reviving inflation fears and weighing on equities and crypto alike.

U.S. equity futures also weakened, with S&P 500 and Nasdaq 100 contracts edging lower as investors moved into a more defensive stance ahead of the American session.

Derivatives markets saw heavy deleveraging, with total liquidations reaching $958.8 million over 24 hours. Long positions accounted for $897 million of the wipeout, highlighting a predominantly one-sided unwind of bullish leverage.

Bitcoin open interest was largely stable overall, though CME futures dropped 9.85% to $7.56 billion, signaling reduced participation in regulated products. Offshore perpetuals held steady, while funding rates remained near neutral, suggesting limited conviction in aggressive directional positioning.

Ether futures diverged, with open interest rising to a record 16.39 million ETH, or about $32.6 billion, even as spot prices declined. The pattern points to increasing short positioning and sustained speculative activity despite weakening price momentum.

XRP open interest slipped alongside price weakness, indicating position unwinding rather than fresh short accumulation. Across major altcoins including SOL, funding rates turned negative across most venues, with shorts paying longs on platforms such as Binance, reflecting a broader tilt toward bearish sentiment.

Options markets are also in focus, with roughly $8 billion in contracts set to expire on Deribit, including $6.5 billion in bitcoin and $1.4 billion in ether. Bitcoin’s max pain level sits near $75,000, slightly above spot, with notable concentration of open interest at higher strikes.

Despite the sell-off, volatility remains muted. Deribit’s DVOL index continues to hover near the lower end of its yearly range, while short-dated skew shows elevated demand for downside protection.

Broader crypto markets weakened in tandem, with the CoinDesk Computing Select Index falling nearly 3%. Thin liquidity in select altcoin pairs amplified price swings, producing sharp intraday moves and quick reversals.

Some tokens experienced outsized volatility, including Humanity protocol (H), which plunged more than 30% before rebounding sharply. AI tokens such as RENDER and FET, along with DeFi names like JUP and ETHFI, also recorded notable losses.

Sentiment across the sector continues to deteriorate, with CoinMarketCap’s Altcoin Season Index falling to its lowest level in more than three months, underscoring a sustained risk-off tone in digital assets.