The cryptocurrency market and global stock indices have experienced a sharp decline today, with major cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) falling unexpectedly. This sudden drop follows a provocative move by Russian President Vladimir Putin, who signed a decree allowing for the possible use of nuclear weapons. The market response is also tied to escalating geopolitical tensions, including US President Joe Biden’s approval for Ukraine to strike Russian territory using American missiles.

Putin’s Nuclear Decree Triggers Global Market Panic

On November 19, President Putin signed a controversial decree that potentially escalates Russia’s stance on nuclear warfare. The decree allows for the use of nuclear weapons against any non-nuclear state that supports other nuclear powers. This provocative action is seen as a direct response to Biden’s authorization of Ukraine using US missiles to strike Russian positions, which heightens fears of a larger military conflict. Putin’s move has not only affected geopolitical stability but has also triggered panic across global stock markets and cryptocurrency markets, leading to widespread sell-offs.

Stocks and Crypto Markets React to Geopolitical Instability

Following Putin’s decree, stock markets around the world experienced a sharp decline. Major US stock futures tied to the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite all fell as investors reacted to the heightened risks of a potential nuclear escalation. The sudden wave of uncertainty and fear led to a reversal of recent market gains, and traders began exiting positions to limit potential losses.

In parallel, the crypto market also took a hit. Leading cryptocurrencies like Bitcoin, Ethereum, and Solana witnessed significant losses, with Bitcoin dropping nearly 0.50% and Ethereum seeing similar declines. Altcoins, including XRP, Dogecoin, and Cardano, saw even steeper drops of over 1% within the span of just an hour.

A Sell-Off Fueled by Long Liquidations

According to Coinglass data, the market’s recent sell-off was exacerbated by a large number of long liquidations. As traders rushed to close their positions, the downward momentum accelerated. The sell-off became more pronounced as PNUT, RAY, and other recent gainers saw their prices drop sharply. For instance, PNUT dropped by 5%, falling to $1.68.

Is Bitcoin Headed to $82K Amid Panic?

The sudden decline in the crypto market has led some analysts to predict that Bitcoin could experience a further 10% correction, potentially dropping as low as $82,000. CoinGape reports that on-chain metrics and market sentiment suggest such a move, with key support zones for Bitcoin between $85,800 and $83,250, and potentially as low as $72,880.

With the Crypto Fear and Greed Index currently in the “extreme greed” zone, traders are likely to engage in profit booking, further intensifying the downward pressure on prices. CryptoQuant CEO Ki Young Ju pointed out that 99.3% of unspent transaction outputs (UTXOs) are currently in profit, highlighting that the market is in an euphoric phase. However, such conditions are often precursors to corrections, and the ongoing geopolitical unrest could hasten this shift.

Conclusion: Geopolitical Risks and Market Volatility

Today’s unexpected sell-off in both the stock and crypto markets underscores the significant influence of geopolitical risks on investor sentiment. Putin’s nuclear decree, combined with escalating tensions between the US and Russia, has sent shockwaves through financial markets. As Bitcoin and other cryptocurrencies experience declines, investors are advised to stay cautious and monitor developments closely. With extreme greed setting the stage for potential profit-taking, further volatility is expected in the coming days.