Bitcoin has largely absorbed the impact of the latest escalation in the Middle East, after U.S. futures markets recorded sharp volatility on Sunday. Traders are still assessing how these tensions could affect the global energy market.
U.S. and Israeli airstrikes targeting sites in Iran were followed by retaliatory missile and drone attacks, raising concerns about the risk of broader regional conflict - especially after reports suggested that Supreme Leader Ali Khamenei had been killed.
Iran has warned it will continue retaliatory actions, while disruptions to shipping and aviation activities in the Persian Gulf have heightened fears that the conflict could expand beyond a limited confrontation.
Bitcoin is currently down 0.4% on the day to $66,600, after partially recovering from weekend losses when it briefly fell to $63,000. On a weekly basis, the asset is down around 2.8%, according to data from CoinGecko.
Bitcoin’s decline has been relatively modest compared to U.S. equity index futures, which dropped more than 1% across Nasdaq Composite, Dow Jones Industrial Average, and S&P 500. This suggests investors are broadly adjusting their risk appetite amid macroeconomic and geopolitical developments unfolding outside regular U.S. trading hours.
Ryan McMillin, Chief Investment Officer at Merkle Tree Capital, said Bitcoin’s initial sell-off was almost “textbook”: markets tend to dislike uncertainty more than bad news itself, and once the Iran conflict appeared contained, dip buyers quickly stepped in.
He pointed out that the Crypto Fear & Greed Index had fallen to 11, while Bitcoin futures funding rates dropped to -6%, indicating that short sellers are paying a significant premium to maintain bearish positions - a situation not seen since Bitcoin traded around $16,000 in 2022.
“Mechanically, the market is paying you to hold long positions; this is the time to go long,” McMillin emphasized.
Sharing a similar view, Pratik Kala, Head of Research at Apollo Crypto, believes that most of the initial shock has already been priced in.
“If Bitcoin needed to drop further, it would have. Price action throughout the weekend was relatively constructive. CME futures have also reopened; if Bitcoin wanted to plunge or follow equities lower, it would have happened,” he said.
On a broader scale, markets are closely watching the risk of disruption at the Strait of Hormuz - a critical shipping route that transports roughly 20% of global oil supply.
Oil prices have surged following the Iran tensions, with Brent crude rising 8–10% to nearly $80 per barrel, while West Texas Intermediate gained 7–8%.
“If oil prices remain elevated, the risk of resurging inflation becomes real, which would be negative for risk assets - including Bitcoin,” Kala noted. “However, I don’t see this as the base-case scenario.”
He added that additional supply from OPEC nations could offset shortages, and suggested that Donald Trump may take measures within his capacity to keep energy prices low, given his understanding of how fuel costs influence U.S. voter sentiment.
Meanwhile, gold - the traditional safe-haven asset - has climbed more than 2% to $5,388 per ounce.
Han Tan, Head of Market Analysis at Bybit Learn, said that Middle East tensions continue to support gold prices, potentially triggering a short-term rally driven by safe-haven demand.
However, he also cautioned that seasoned investors understand geopolitical risk premiums tend to fade quickly once markets fully assess the economic impact and conclude that the situation remains under control.
Navigating Volatility: Security Matters More Than Ever
Periods of geopolitical tension and macro uncertainty highlight one critical truth: volatility is inevitable - but asset security is non-negotiable.
When markets swing sharply and funding rates turn extreme, investors need more than just market insight - they need a secure and reliable place to store and manage their digital assets. This is where Pulse Wallet plays a crucial role.
Pulse Wallet is built to provide a secure, user-friendly environment for storing and transacting crypto assets, especially within the PulseChain ecosystem. In times of heightened uncertainty, having full control & access to your funds, and a stable infrastructure becomes a strategic advantage - not just a convenience.
While price fluctuations may come and go, safeguarding your assets should always remain a priority.
Disclaimer: This article is for informational purposes only and does not constitute financial, investment, or trading advice. Cryptocurrency markets are highly volatile and subject to significant risk. Always conduct your own research and consult with a qualified financial advisor before making investment decisions.
Don’t forget to follow us for the latest updates!
🌐 Official Website | 🎒 Official Twitter