Bitcoin has experienced a decline over the past week, although its drop has been relatively moderate compared to the broader downturn in equity markets following the escalation of conflict in Iran on February 28. As of Sunday, the leading cryptocurrency traded at approximately $68,000, reflecting a decrease of around 2% in the last 24 hours and about 6% over the past week, according to data from CoinGecko.
This movement aligns with ongoing geopolitical tensions, particularly as the conflict in Iran enters its fourth week, driving crude oil prices higher and contributing to a broader retreat in risk assets as of Friday. The situation escalated over the weekend after U.S. President Donald Trump issued a 48-hour ultimatum for Iran to fully reopen the Strait of Hormuz or face potential military strikes on Iranian power plants. In response, Iranian officials threatened to completely shut down the critical oil shipping route and target U.S.-linked energy infrastructure in the region.
In the wake of these developments, U.S. stocks have faced a consistent downward trend, marking four consecutive weeks of losses. The S&P 500 index notably dropped below its 200-day moving average last week for the first time since March of the previous year. Current data reveals that both the S&P 500 and the Nasdaq have seen declines of approximately 4% to 5% this month, with energy being the only major sector experiencing growth as oil prices inch closer to $100 per barrel.
Despite the tumultuous climate, Bitcoin’s monthly decline of only 0.2% stands in stark contrast to the more substantial drops in equities. This relative stability is partly attributed to prior deleveraging within the crypto market and sustained interest from institutional investors. John O’Loghlen, managing director for APAC at Coinbase, stated that Bitcoin has outperformed traditional assets in terms of risk-adjusted returns since the onset of the Iran conflict. He noted that with oil acting as a driver of global inflation, there has been a noticeable uptick in institutional inflows into cryptocurrencies and U.S. Bitcoin ETFs.
O’Loghlen also suggested that the crypto market might be moving past the peak of pessimistic sentiment, although stronger participation will be essential for fostering a more sustained rally. While overarching macroeconomic factors continue to influence market sentiments, experts emphasize that the crypto market is showing signs of resilience rather than widespread sell-offs.
Nischal Shetty, founder of WazirX, echoed this sentiment, describing the crypto market as being in a phase of steady consolidation. He indicated that Bitcoin has maintained support levels near the lower end of its recent trading range while facing resistance close to recent highs, suggesting that buyer activity persists despite ongoing macroeconomic uncertainties.
