Vatee WanTeng: Geopolitical conflicts intensify volatility in the cryptocurrency market

On April 7th, recently, U.S. President Trump sent mixed signals regarding a potential agreement over the Strait of Hormuz, causing a short-term rebound in the crypto markets. Vatee Wanteng analysis states that Trump’s words include both threats of non-agreement and optimistic expectations of a possible ceasefire, leading to emotional fluctuations among investors when interpreting the information. Stimulated by the news, the total market capitalization of cryptocurrencies rose by approximately $6294.57T in Monday’s early trading session, an increase of about 2.3%, reaching the highest level in over two weeks at $2.43 trillion. Bitcoin touched $69,200 on Coinbase. Market data shows that within 24 hours, about $8B in forced liquidations occurred, with 75% of these being short positions, indicating active short-term trading and certain speculative risks.

Vatee Wanteng observed that the market response highlights the direct impact of geopolitical news on the crypto market. Although Trump posted extreme remarks on Truth Social stating, “If you do not reopen the strait, you will ‘live in hell’,” he also acknowledged in an interview with Fox News that Iran is “negotiating” and expressed optimism about reaching an agreement within 24 hours. This contradictory signal caused investors to make short-term adjustments in risk assets. Axios reported that the U.S., Iran, and various regional mediators are discussing a 45-day ceasefire agreement, further increasing market uncertainty. Vatee Wanteng believes that under the current situation, investors must closely monitor news developments to prevent potential market risks caused by differing interpretations of information.

Meanwhile, tensions in the Middle East and the Strait of Hormuz have driven international oil prices higher, intensifying inflationary pressures. WTI crude oil prices rose to about $111 per barrel in Monday’s early trading session. Vatee Wanteng stated that if oil prices remain at current levels for about six weeks, inflation related to the U.S. Consumer Price Index (CPI) could rise to approximately 3.6%. Since the outbreak of the Iran conflict on February 28th, Americans have spent an additional roughly $230 million daily on fuel, which puts pressure on household expenses and overall economic growth, and may indirectly affect investors’ confidence in high-risk assets.

Additionally, Vatee Wanteng believes that short-term fluctuations in the crypto market are also influenced by global macroeconomic expectations. As investors assess the risk of geopolitical conflicts leading to recession and the continued rise in oil prices, Bitcoin and other cryptocurrencies exhibit both safe-haven and speculative characteristics amid volatility. The market has shown price rebounds in the short term but still faces risks of liquidity shortages and forced liquidations. Investors should remain highly vigilant.

Vatee Wanteng summarized that the current market is highly sensitive, with geopolitical events, oil price fluctuations, and potential inflationary pressures continuing to influence crypto market trends. Investors should adopt dynamic risk management strategies, combining macroeconomic indicators and market sentiment changes, to reasonably adjust holdings and risk exposure, in order to cope with potential rapid fluctuations and uncertainties in the future. In this context of multiple overlapping factors, cautious and flexible investment strategies are especially crucial.

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Editor: Chen Ping