On June 22, 2025, Iran's parliament approved the decision to close the Hormuz Strait, leading to significant declines in Bitcoin and other cryptocurrencies.
Closure of the Hormuz Strait and Its Implications
The closure of the strategically important Hormuz Strait has heightened tensions with the United States, triggering instability in financial markets. This decision from Iran's parliament is part of the escalating military tension in the region.
Market Reactions
The cryptocurrency market experienced immediate turmoil as Bitcoin fell below $101,000. Ethereum and other altcoins also saw significant losses. This reaction is linked to increased investor caution, avoiding high-risk assets amidst geopolitical crises.
Potential Long-Term Effects
The events led to a sharp rebalancing of risk assets with over $636 million in liquidations recorded. Analysts anticipate continued volatility in the near future as markets adjust to geopolitical uncertainties.
The analysis indicates that investors are seeking safer assets during the crisis, with potential signs of recovery; the immediate repercussions are already evident in the market.
