Crypto Markets Slump 2% Following Hamas Attack on Israel

Cryptocurrency prices buckled Monday alongside modest declines in global equity markets and rising oil prices on renewed Middle East turmoil.

Bitcoin [BTC] dropped 1.7% over the past 24 hours to $27,500, outperforming most digital assets as crypto investment services firm Matrixport touted the largest crypto asset as "better than digital gold." Bitcoin late Friday and over the weekend seemed primed to challenge a two-month high above $28,400, but was unable to move above $28,200 before sellers finally took over early this morning.

The broad CoinDesk Market Index (CMI) was lower by 2%.

Ether [ETH] suffered a 2.5% decline as – in addition to macro jitters – the Ethereum Foundation sold $2.7M of tokens on UniSwap. The second largest cryptocurrency by market capitalization extended its losing streak against BTC, dropping to a fresh 15-month low relative to bitcoin.

Losses were larger among other altcoins. Ripple Labs-adjacent token [XRP], solana [SOL], Polygon's native token [MATIC], Avalanche's [AVAX] and popular meme token dogecoin [DOGE] are all lower by 4%-5% over the past 24 hours.

Hamas attack on Israel shakes markets

The Israel-Hamas conflict extended to its third day on Monday. Fears of the conflict spilling over to neighboring states, such as Iran, seemed to impact oil prices as traders opined it could disrupt supply.

“There could be “a pretty dramatic effect on the oil market” should the U.S. enforce sanctions on Iranian exports, Josh Young, chief investment officer of energy investment firm Bison Interests told CNBC. “I think it’s appropriate to see oil, let’s say, [up] about $5 for WTI.”

WTI crude oil rose near 3.5% since Sunday to $86.54 per barrel, MarketWatch data shows, extending three-month gains to 16%.

Equity markets in Asia closed the day in red and while Europe and U.S. stocks are lower as well, the losses are rather modest with the Stoxx 600 off just 0.25% and the S&P 500 down 0.6%.