The crypto market fell sharply on Wednesday alongside U.S. stocks as renewed military conflict in the Middle East pushed Brent crude oil to a 12-day high of $96 per barrel. Bitcoin dropped 2.4% to $65,699, its lowest since late March, while Ethereum and Solana each fell about 5% to $1,830 and $72, respectively. The sell-off followed U.S. Central Command's report of intercepting Iranian missiles and conducting self-defense strikes near the Strait of Hormuz, a critical chokepoint for 20% of global oil supply. The escalation dashed hopes for a peaceful resolution and fueled fears of prolonged energy disruptions. Rising energy costs pushed the U.S. 10-year Treasury yield to 4.5%, signaling investor concern over near-term inflation. Carlos Guzman, VP of research at crypto trading firm GSR, attributed the drop to a 'continuation of weakness' exacerbated by Strategy's recent sale of 32 Bitcoin for $2.5 million. Analysts at Compass Point described Bitcoin's plunge as a 'capitulation event,' noting that 26% of sales over the past 320 days came from investors who bought above $90,000, suggesting the bear market may be in late stages.

Key facts

• Bitcoin fell 2.4% to $65,699, lowest since late March; Ethereum and Solana dropped 5% each.
• Brent crude rose to $96/barrel as Middle East conflict escalated near Strait of Hormuz.
• U.S. 10-year Treasury yield hit 4.5% on inflation fears from rising energy costs.
• Strategy sold 32 Bitcoin for $2.5 million, adding to retail pessimism.
• Compass Point analysts called Bitcoin's drop a 'capitulation event' suggesting late bear market.

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