Bitcoin fell back below $70,000 as reports emerged that the Pentagon is preparing military plans for Iran, including potential ground forces and a major bombing campaign. The cryptocurrency is testing a key on-chain support level near $70,200, with analysts noting its recent rally has been leverage-driven and vulnerable. Market uncertainty remains high, as prediction markets show increased odds of a significant escalation.
Bitcoin slipped under $70,000 amid reports the Pentagon is preparing plans including a ground invasion and “massive bombing campaign” in Iran. President Donald Trump’s five-day pause of strikes expires Friday, as Axios detailed the military’s developing options.
On prediction market Myriad, users now place a 60% chance on U.S. boots on the ground in Iran before May. Bitcoin’s recent pattern of higher lows, often associated with accumulation, faces a critical test from this geopolitical uncertainty.
Short-term holders who bought within the last month carry a cost basis of approximately $70,200, marking a key support floor according to a Glassnode report. The one-to-three-month cohort sits at $82,200, creating overhead resistance.
However, the accumulation cluster at $70,200 is modest. “The higher probability of a breakdown below this level cannot be dismissed until a more substantial base of committed buyers is established,” the report noted. Bitcoin traded near $69,522, down 3% over 24 hours.
“From the current price action, we do see some signs that stronger hands are accumulating,” Tim Sun, senior researcher at HashKey Group, stated. “This still looks more like defensive accumulation than confirmation of a new trend-driven rally.”
Market volatility expectations are extreme. Front-month VIX futures intraday volatility hit 388.2, the highest reading in at least six months according to The Kobeissi Letter. This suggests markets are bracing for a potential shock rather than reacting to one.
Sun said the wide gap between implied and realized volatility indicates strong hedging demand. He warned a break below $70,000 “is not out of the question,” noting the rally has been driven more by leverage than sustained spot buying.
Myriad users remain split on Bitcoin’s next move, assigning a 50% chance of a retest at $84,000. The convergence of vulnerable on-chain support and macro uncertainty sets up a pivotal period for the cryptocurrency.
