Bitcoin price opened strong in US trading, rising 3% to over $68,000, according to crypto slate data.
This marked a big difference from the initial response, which seemed less like a safe-haven deal in the wake of recent tensions in the Middle East.
After headlines about the US attack on Iran broke over the weekend, the flagship digital asset fell below $64,000 before stabilizing, acting more like a liquid 24-hour risk asset than digital gold.
Gold reversed higher, climbing towards $5,376 an ounce as investors sought traditional protection.
In foreign exchange, the Swiss franc and Japanese yen strengthened, while the dollar held firm, a familiar sign that markets are bracing for further spillovers.
That first move is important, but not as important as the next phase.
For Bitcoin, the more important question is rarely what happens in the first 24 hours of a geopolitical shock.
This will happen after the first wave of liquidations has passed, oil prices have found their range, and the market has begun to decide whether this event is a permanent macro problem or a short-term violent disruption.
Here, the historical case becomes more interesting and more supportive for Bitcoin than the first candlestick suggests.
Why Bitcoin is often the first to be dumped
Bitcoin’s market structure is particularly vulnerable during the initial stages of a shock.
Digital assets are traded non-stop, including on weekends and when stock markets are closed. That makes it one of the first places for global investors to voice concerns and raise funds.
In moments of uncertainty, assets that remain open tend to be the earliest to absorb pressure.
Payment is also easy. When volatility spikes, investors tend to reduce their fastest-moving positions, and the crypto market is always available.
As such, Bitcoin has repeatedly been used as a pressure valve for broader risk sentiment, especially when macro news is released outside of traditional market hours.
Then there’s leverage. A forced liquidation can make headlines and push prices lower than the initial news alone would justify.
This year, the market has seen large-scale liquidations of Bitcoin, amplified by illiquidity, amid broader risk asset stress.
These mechanics help explain why Bitcoin could fail the first-stage haven test without invalidating the long-term bullish case.
Initial moves are often more about fluidity and positioning than confidence. What happens after that depends less on the initial strike and more on how that event affects oil, inflation, interest rates, and dollar liquidity.
Oil will be the real switch for the next 60 days.
Energy is a key transmission channel in this U.S.-Iranian conflict, as it could have a major impact on global markets.
Reuters previously reported that Brent oil prices could head towards the low $80s if the conflict remains contained.
However, if the disruption deepens, oil prices could rise towards $100 and a significant supply shock could increase global inflation by an estimated 0.6-0.7 percentage points.
This distinction is important because oil can change the direction of policy, and policy often changes the direction of Bitcoin.
At the time of writing, oil prices were up about 9% to $80, according to FactSet data. This is the highest value in more than two years.
Therefore, if the current soaring oil prices continue and inflation accelerates again, there will be less room for central banks to ease monetary policy.
Real yields are likely to remain steady. The dollar can maintain its strength. This combination has historically weighed on risk appetite and limited the rebound in high-beta assets, including cryptocurrencies.
In this regime, gold is in a better position as it directly benefits from fear and inflation hedging, while Bitcoin has to contend with a tougher financial environment.
The situation will change once oil subsides and the conflict appears to have subsided. Hedges may come undone. Volatility may be reduced.
The assets that were easiest to sell during the panic are likely to rebound once the forced sell-off is halted. This is the background behind why Bitcoin’s post-shock movements can sometimes look the strongest.
That’s why the next 60 days are more important than the reaction over the weekend. The first move signals to investors that fear is coming. The next action tells us what a horror it was.
This time, ETFs changed the plumbing.
The biggest structural difference between the current market and the previous one is that Bitcoin has institutional rails that did not exist at the time.
US-listed Bitcoin ETFs have created a visible demand channel and also made it easier to track risk aversion.
Bitcoin ETF spot outflows reached nearly $2 billion in the first two months of this year, according to data from SoSo Value. This is a sign that some in the investor base were already on the defensive before the latest geopolitical shocks.
This is important because the argument that Bitcoin is set to outperform doesn’t hold up on narrative alone. We need to answer the practical question of who will buy it.
In past cycles, this question was more difficult to measure in real time. It is now visible, at least in part, through ETF flows.
On the other hand, this change affects both directions. If risk aversion persists, ETFs could turn caution into sustained outflows, amplifying selling pressure.
However, if tensions ease, the rebound could accelerate by channeling new demand into spot Bitcoin more efficiently than the old market structure allowed.
That’s why the next phase is so important. Bitcoin now has deeper institutional plumbing that can transmit both stress and recovery.
Additionally, internal cryptocurrency positioning suggests that the market is not fully committed either way.
While stablecoin dominance has hovered around 10.3%, net inflows into stablecoins of around $22 billion over the past few weeks suggest investors are moving to cash equivalents rather than exiting the ecosystem entirely.
The options market as a whole crypto slate We previously reported that Bitcoin traders are cautiously optimistic about the market but are increasingly paying for downside protection.
These signals can be read in the opposite direction. On the other hand, it points to a cautious hedging market.
At the same time, it also shows the potential of dry powders. So capital sitting on the sidelines could quickly return once fears subside.
What history tells us about the future of Bitcoin
BlackRock, a $13 trillion asset management company, attempted to frame Bitcoin’s geopolitical moves through a simple comparison of the performance of gold and the S&P 500 10 and 60 days after these big shocks.
The results showed that once Bitcoin overcomes the initial turmoil, it often becomes one of the strongest rebounding assets in the post-shock period.
For context, the US-Iran escalation in January 2020 remains the clearest example of the current configuration. Bitcoin rose about 26% over the next 60 days, according to BlackRock data. Gold rose about 7%. The S&P 500 fell about 8%.
It is because of this history that the idea that Bitcoin can outperform during geopolitical crises continues to surface even after initial bearish episodes.
wide range of results
With this in mind, the clearest way to think about the next 60 days is through scenarios, not certainty.
If the conflict remains contained and oil prices stabilize around $80, this backdrop could support a 10% to 25% rebound in Bitcoin over 60 days. This will push the BTC price above $80,000.
In that case, gold could be flat to slightly higher, while stocks could remain range-bound. This is the setup most consistent with the historical pattern where Bitcoin looked like a winner after the 2020 shock.
If tensions persist and oil prices remain in the $90-$100 zone, environmental support will further weaken. Defensive trading is likely to prevail as inflation concerns reignite and policy easing may be delayed.
In this regime, Bitcoin’s range could widen from -15% to +10%, while gold outperforms and stocks remain under pressure. Here, the top cryptocurrency could fall as low as $56,479 or trade higher above $73,000.
A more serious disruption would send a darker message. Risk aversion among assets could intensify if energy infrastructure and transportation face continued stress.
In liquidity events like this, Bitcoin underperforms as a high-beta asset, potentially falling 10% to 30% in 60 days, while gold rises further. This will push BTC further into bearish territory below $50,000.
On the other hand, there is also a tail case in the opposite direction.
If growth concerns become serious and markets start pricing in accelerated easing and liquidity support, Bitcoin could be one of the main beneficiaries.
Historically, some of the strongest rebounds after shocks have occurred when markets shifted from concerns about inflation to expectations for policy easing.