On Saturday, February 28, 2026, coordinated U.S. and Israeli strikes against Iran — codenamed Operation « Epic Fury » — triggered a brutal Bitcoin sell-off of more than 6%, briefly pushing BTC below $63,000. Within hours, Bitcoin staged a spectacular V-shaped recovery to reach $68,196, nearly erasing all losses. This recovery illustrates a now-structural phenomenon in the ETF era: Bitcoin absorbs all global selling pressure around the clock while institutional liquidity remains concentrated in regulated weekday sessions. Monday’s opening of U.S. markets will be the decisive test.
Operation « Epic Fury »: An Unprecedented Geopolitical Shock
In the early hours of Saturday, February 28, 2026, the United States and Israel launched coordinated military strikes against Tehran and several major Iranian cities. Iranian state media subsequently confirmed the death of Supreme Leader Ayatollah Ali Khamenei in the strikes. Iran retaliated with counter-attacks on multiple regional targets — Israel, Qatar, the UAE, and Bahrain — while threatening U.S. military bases in Iraq.
The crypto market reaction was immediate and violent. Bitcoin dropped more than 3.8% in a single hour, falling below $64,000. Over $100 million in leveraged long positions were liquidated in just 15 minutes. In total, approximately $490 million in positions were wiped out within 24 hours, including $196 million in Bitcoin and $132 million in Ethereum.
A Lightning Rebound Fueled by « Buy the Dip »
Despite the initial panic, Bitcoin executed a remarkable turnaround. By Sunday morning, BTC had reclaimed the $67,000 – $68,000 range, posting a 5.6% gain in 24 hours. Ethereum followed suit, rising 4.58% to reclaim the $2,000 level.
Cryptocurrencies recovered approximately $32 billion in market capitalization by Sunday morning, after shedding roughly $128 billion the day before according to CoinGecko. Traders quickly bought the dip, anticipating a potential de-escalation given the power vacuum in Tehran.
« Traders generally don’t expect the Iran conflict to have major negative economic consequences, and demand for bullish Bitcoin call options has clearly increased in recent days. »
— Markus Thielen, Head of Research at 10x Research
The Weekend/Weekday Divide: A Structural Risk Amplified by ETFs
This flash crash highlights a structural vulnerability that has become increasingly apparent since the launch of spot Bitcoin ETFs in 2024. Weekend activity has collapsed while weekday volumes have surged — particularly on Coinbase. This asymmetry creates « air pockets » on weekends, amplifying the risk of sharp moves when a geopolitical event strikes during low-liquidity hours.
« Bitcoin is the only large liquid asset trading 24/7, so it absorbed all the selling pressure that would have normally been distributed across equities, bonds, and commodities. Real price discovery happens Monday, when U.S. equity markets and Bitcoin ETFs reopen. »
— Hayden Hughes, Managing Partner at Tokenize Capital
Monday Will Be Decisive: Spot ETFs and the CME Gap
ETF Flows in the Spotlight
The week preceding the event had already shown encouraging signals. U.S. spot Bitcoin ETFs recorded $787.4 million in net inflows for the week ending February 27, reversing the $315.86 million in outflows from the prior week. On February 25 alone, BlackRock’s IBIT captured $297.4 million in inflows — its largest single-day figure since February 9.
Over three consecutive days (February 24–26), more than $1.02 billion flowed into Bitcoin ETFs, with IBIT controlling approximately 96% of net volume. If Monday sees another wave of institutional buying through ETFs, Bitcoin’s recovery could gain lasting momentum.
The CME Gap as a Key Technical Indicator
CME Bitcoin futures do not trade on weekends, while the spot market continues operating 24/7. This systematically creates a price gap between Friday’s close and Monday’s open. Historically, approximately 98% of CME gaps are eventually filled, typically within 5 trading days. In 2026, the frequency and magnitude of these gaps have increased significantly — a $655 gap was observed on January 1, 2026, some 69% above the January average for 2021–2025.
The Oil Factor: The Strait of Hormuz as a Tipping Point
The primary transmission channel between Iranian geopolitics and financial markets runs through energy. The Strait of Hormuz carries approximately 20% of global oil supply and 20% of LNG shipments, making it a critical strategic chokepoint. If crude prices were to spike, the reaction chain would be: rising inflation expectations → firmer bond yields → stronger dollar — a particularly hostile cocktail for risk assets like Bitcoin.
ING analysts have already raised their Brent price forecast for 2026, lifting the average from $57/barrel to $62/barrel, with a geopolitical risk premium estimated at $4–10/barrel. In the event of a major Strait disruption, Brent could surge to $140/barrel, with significant consequences across all financial markets.
Key Technical Levels to Watch
| Level | Role | Why It Matters |
|---|---|---|
| $64,700 | Primary support | Held during the weekend shock; maintaining it preserves the rebound thesis |
| $65,400 | First recovery threshold | Reclaiming it transforms a dead-cat bounce into a genuine trend recovery attempt |
| $63,800 | Breakdown level | A breach shifts focus to lower support zones |
| $62,850 | Deep support | A failure here raises the risk of a broader downside move |
| $69,270 – $70,730 | Resistance band | Requires sustained risk appetite and positive ETF flows to challenge |
The RSI currently reads 58 — a neutral and healthy level with comfortable room for further upside. Selling pressure appears to have largely dissipated.
Two Scenarios for the Week Ahead
🟢 Bullish Scenario: Contained Escalation
If geopolitical tensions stabilize and the power transition in Tehran unfolds without a major new military escalation, Bitcoin should hold the $64,700 support and reclaim $65,400. Monday’s ETF flows could confirm the prior week’s trend ($1 billion over 3 days), putting the $69,000–$70,000 resistance back in play. This outcome remains conditional on oil prices stabilizing.
🔴 Bearish Scenario: Energy Shock
If the military situation worsens with actual disruptions to the Strait of Hormuz, crude would spike sharply, triggering the inflation + rising yields + stronger dollar trifecta. In this case, Bitcoin would break below $63,800 and target $62,850. The psychological support at $60,000 would become the next key reference, with cascading liquidations potentially amplifying the decline.
Macro Context: An Already Fragile Backdrop
This shock does not unfold in a vacuum. Earlier in the week, trade uncertainty had already weighed on investor sentiment after the U.S. Supreme Court limited Trump’s tariff authority. The shift to a flat 15% tariff via Section 122 reintroduced uncertainty around U.S. trade policy prospects.
Bitcoin had already shed roughly 50% from its all-time high of over $126,000 reached in October 2025, underscoring the market’s persistent fragility despite sporadic recoveries. Cumulative outflows from spot ETFs since the start of 2026 stood at approximately $4.5 billion prior to the late-February reversal.
Conclusion
Bitcoin’s rebound to $68,000 following the Iran strikes demonstrates remarkable resilience from crypto markets — but the real test begins Monday with the reopening of U.S. markets, spot ETFs, and CME futures. Institutional flow dynamics — particularly BlackRock’s IBIT — will be the decisive factor in determining whether this recovery becomes a sustained trend or whether the market reverts to lower support levels. The trajectory of oil prices and Iran’s diplomatic and military response in the coming hours will be equally critical in shaping the broader investor sentiment.
