The cryptocurrency market came under renewed selling pressure after US President Donald Trump said the United States was “taking over” responsibility for protecting the Strait of Hormuz.
His comments pushed oil prices higher and increased concerns about escalating tensions between the United States and Iran. Bitcoin dropped below $62,200, while the wider crypto market reportedly lost around $20 billion in value.
Trump Says the US Will Protect the Strait of Hormuz
President Trump said the United States would defend the Strait of Hormuz but expected other countries to pay for that protection.
His remarks added further pressure to global financial markets on July 13. Brent crude oil climbed above $79 per barrel as investors reacted to the growing risk of disruptions in one of the world’s most important energy routes.
Trump claimed that the United States was assuming control of the strait after negotiations failed to produce a lasting agreement.
He also issued another warning to Iran following the reported collapse of a ceasefire. According to Trump, US forces carried out significant overnight strikes that destroyed important Iranian military equipment.
Oil Prices Rise as US-Iran Tensions Escalate
Oil prices gained almost 4% on Monday as the United States and Iran continued exchanging strikes.
The market reaction intensified after Iran reportedly announced that the Strait of Hormuz had been closed. However, US Central Command rejected that declaration.
The Strait of Hormuz is a critical passage for global oil shipments. Therefore, any disruption could reduce energy supplies, raise inflation concerns and increase volatility across stocks, cryptocurrencies and other risk assets.
Higher oil prices can also create additional pressure on central banks by making inflation more difficult to control.
Bitcoin Falls Below $62,200
Bitcoin extended its losses following Trump’s comments, dropping more than 3% within several hours.
According to the original report, Bitcoin was trading near $62,389. Its 24-hour trading range was between approximately $62,120 and $64,340.
The decline was not limited to Bitcoin. Several leading altcoins also recorded significant losses as investors reduced their exposure to riskier assets.
Ethereum, XRP, BNB, Solana, Hyperliquid, Zcash and Cardano reportedly fell between 2% and 6% during the broader market sell-off.
Crypto Market Loses Around $20 Billion
The total cryptocurrency market reportedly lost approximately $20 billion following the latest geopolitical developments.
Data from Coinglass also showed nearly $40 million in cryptocurrency liquidations across several assets, including Bitcoin, Ethereum, Solana, XRP and Hyperliquid-related markets.
Around 73,000 traders were liquidated over the previous 24 hours. The largest single liquidation was reportedly worth approximately $4.86 million and occurred on Hyperliquid.
Liquidations happen when leveraged trading positions are automatically closed because traders no longer have enough collateral to maintain them.
Traders Await US Inflation Data
Market participants are now focusing on upcoming US economic data for further direction.
The latest Consumer Price Index report is expected to provide new information about inflation. Traders are also waiting for testimony from Federal Reserve Chair Warsh for possible signals about the future direction of US monetary policy.
Stronger-than-expected inflation could reduce expectations for interest-rate cuts. That outcome may place additional pressure on Bitcoin and other risk assets.
However, weaker inflation figures could improve market sentiment and support a short-term recovery.
For now, developments surrounding the Strait of Hormuz, oil prices and US-Iran tensions are likely to remain major drivers of cryptocurrency market volatility.
