$1.8B in 60 minutes: How war headlines triggered historic leverage purge

As news of “Operation Epic Fury” broke and reports confirmed a U.S.-Israeli strike over Tehran on the 28th of February, the crypto market reacted instantly.

Within an hour, digital asset traders turned the market into a fear bubble. This wasn’t a gradual decline. Traders rushed to sell, triggering panic at full speed.

According to CryptoQuant, sellers pushed nearly $1.8 billion in volume through the market in just one hour. But the real impact showed up in the derivatives market.

The Bitcoin Derivatives Pressure Index dropped from 30% to 18%, showing that bullish confidence collapsed fast.

Many leveraged traders were forced out, triggering what’s known as a leverage purge, a chain reaction where falling prices cause more liquidations and even more selling.

So yes, prices fell. But risk was also flushed out of the system.

And despite rising geopolitical tensions, the crypto market has shown surprising strength, suggesting the panic may have already done its damage.

Crypto market didn’t blink

At press time, the Crypto Fear and Greed Index was standing at 14, which signaled “Extreme Fear.” But this is actually an improvement from the 23rd of February, when it dropped to a very low level of 5.

That day marked one of the sharpest collapses in market confidence in recent memory.

The difference now is clear. Investors are still cautious, but the blind panic from last week has eased. This change is also visible in the numbers.

The total crypto market cap has climbed to $2.32 trillion, rising 3.39% in just 24 hours. Bitcoin has moved back above $67,114, gaining 4.34%. Ethereum [ETH] has done even better, jumping 6.86% and trading above $2,000 again.

Community is confident about Bitcoin and altcoins

Remarking on Bitcoin’s strength, a user on X put it best when he said,

He added, 

Additionally, there have also been talks around the upcoming altcoin season. Remarking on the same, another X user said, 

This shows that the market is rotating, and people are ready to move their money slowly into altcoins. He added, 

Echoing similar sentiments, another user added, 

However, as per data from CoinMarketCap, we still stand in the Bitcoin season zone. 

Past reactions to war

In the past, military tensions involving Iran have often caused short-term panic in Bitcoin, but the drops didn’t last long. Looking back, in April 2024, Bitcoin [BTC] fell 8% overnight but recovered within two days.

In October 2024, Bitcoin dropped 3%, but it recovered within a single day. In June 2025, it fell 6% and then surged 62% to new highs. But February 2026 told a different story.

This time, Bitcoin entered the strike already weakened. It had fallen 48% from its all-time high. The Weekly RSI hit its lowest level ever, signaling that the market was deeply oversold.

The Fear & Greed Index stayed in the fear zone for three straight weeks, showing that extreme fear had already taken control.

Meanwhile, traders had reduced Open Interest by 55%, and the market had flushed out leverage over the previous five months. In simple terms, most over-leveraged positions had already been cleared.

So when the new strike hit, the market simply didn’t have many weak hands left to shake out.

What’s more?

While gold and silver stayed slightly positive and the S&P 500 struggled, Bitcoin held up better than expected. This suggests that most of the selling pressure may already be over.

This time, the shock didn’t break the market instead, it might have confirmed where the bottom is.

This coincided with Iran’s digital asset activity reaching around $7.78 billion in 2025, and data showing that people increasingly moved crypto into personal wallets during periods of unrest and currency weakness. 

Ergo, as global tensions continue to rise, the market now waits to see what happens next for crypto.

Final Summary

• Bitcoin entered the conflict deeply oversold, meaning much of the damage was likely priced in beforehand.
• Historical patterns show war-driven dips often reverse quickly, but this cycle began from a structurally different base.