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Bitcoin Falls Below $80,000 After Iran Rejects Trump Deal and Traders Liquidate $91 Million in Long Positions
Bitcoin surrendered its weekly gains, falling from a multi-month high of $82,833 to a daily low of $79,500.
The Iran Peace Deal Factor
On May 7, Bitcoin reversed lower, dropping below the $80,000 mark and effectively erasing the gains accumulated since Monday.
As shown on the daily chart, the leading cryptocurrency, which had reached a multi-month high of $82,833 roughly 24 hours earlier, came under bearish pressure starting Wednesday afternoon.
After losing $1,000 during a gradual decline from midday to midnight, Bitcoin found temporary support around $80,700.
Although a pre-dawn rally pushed the price to $81,600, the momentum proved unsustainable.
The subsequent sell-off became more aggressive, driving the asset down to a daily low of $79,500.
As of 1:00 PM EDT, Bitcoin had partially recovered and was trading just below the $80,000 level.
Bitcoin’s nearly 2% decline pushed its market capitalization below $1.6 trillion, a noticeable drop from the intraday peak of approximately $1.66 trillion reached on Wednesday.
This decline reduced the total cryptocurrency market capitalization to $2.74 trillion from slightly above $2.8 trillion.
The downturn in the crypto market, which mirrored the performance of S&P 500 and Wall Street, coincided with reports that Iran rejected the administration proposal from Donald Trump to end the conflict.
According to a post on X by Walter Bloomberg, senior Iranian official Mohsen Rezaei stated that Tehran rejected the proposal, which called on Iran to reopen the Strait of Hormuz, because it did not include compensation for war-related damages.
Iran’s rejection of the US proposal erased optimism sparked earlier by reports from Axios suggesting that a deal was imminent.
Concerns are growing that the prolonged diplomatic deadlock could embolden hawkish factions in the United States, potentially sidelining supporters of diplomacy and pushing President Trump toward direct military confrontation.
Despite the decline, at the time of writing Bitcoin remained up nearly 5% since the beginning of the month and more than 15% over the past 30 days.
Meanwhile, Bitcoin’s volatility over the last 24 hours resulted in the liquidation of $91 million in overleveraged long positions compared with $12 million in short positions.
Across the broader crypto economy, nearly $270 million in long bets were liquidated versus $90 million in short positions.
See also: "Bitcoin Pulled Back After Trump Questioned a Ceasefire With Iran"
