Original title: Bitcoin Is Up Since the War Started. Here’s What That Actually Tells You.
Original author: Crypto Unfiltered
Compiled by: Peggy, BlockBeats

Editor’s note: When oil prices surge, the stock market faces pressure, and inflation expectations rise again, the market should be entering a typical “risk contraction” phase—something that has indeed happened in this round of the Iran conflict as well. Energy prices have broken through key levels, global assets have broadly pulled back, and macro uncertainty has risen rapidly (The Guardian). But against this backdrop, Bitcoin has shown a somewhat non-intuitive phenomenon: instead of continuing to weaken alongside most risk assets, it has outperformed stocks, gold, and even silver for a period of time (Investopedia).

This article centers on a more critical question: what exactly does this “counter-trend performance” mean?

From the short-term market reaction, Bitcoin will still fall when the conflict escalates and rebound when hopes of easing arise, indicating that it has not yet fully shed its risk-asset characteristics (Barron’s). But over a longer time horizon, its relative returns, capital flows, and relationship with traditional assets are changing—it is no longer just a shadow of tech stocks, nor does it fully obey a single macro narrative.

The article further points out that the true core variable is not “the war itself,” but how the war reshapes the global liquidity environment through oil prices, inflation, and interest-rate expectation. This is also the underlying mechanism behind Bitcoin price volatility. At the same time, institutional capital continues to allocate amid turbulence, gradually shifting the asset’s pricing logic from “emotion-driven” to “structure-driven.”

In this sense, Bitcoin’s rise is not an isolated price signal, but the visible result of a deeper change—a process in which an asset is undergoing a reassessment of its identity.

While the market is still debating what it is, pricing often has already started to change.

Below is the original text:

The current global financial picture is not optimistic. Oil prices are approaching multi-year highs, inflation expectations are rising again, and central banks have started to delay their rate-cut timelines. Stock market sentiment is getting tense, and geopolitical risk has become the dominant variable across virtually all asset classes.

However, since the escalation of the U.S.-Iran conflict at the end of February, Bitcoin has been up by about 7%.

In the same period, the S&P 500 has fallen by about 1%, gold has dropped by about 3%, and silver has fallen nearly 9%. Yet Bitcoin—an asset long criticized as a purely speculative tool, a “risk-on asset,” and even a “tech stock in disguise”—has quietly outperformed all of the above assets.

This data point deserves far more attention than it is receiving right now.

A price picture after stripping out the noise

In early October 2025, Bitcoin briefly hit a historic all-time high of 126,198. As of this week, its price has been hovering around 69,000, down about 45% from the peak. Looking at just this number isn’t encouraging, but when you observe it within the current cycle of conflicts, its performance looks different.

The trend has not been smooth. On April 2, Donald Trump delivered a speech during the gold hour, threatening a forceful attack on Iran. That day, Bitcoin at one point fell to 65,834, setting a new low since 2026. Ethereum fell about 5% the same day. The market’s initial reaction was quite direct: escalation means lower risk appetite, and lower risk appetite typically means crypto assets are sold off.

But then the situation began to change. As news emerged that a “possible 45-day ceasefire” might be reached, Bitcoin rebounded more than 3% within a few hours, briefly breaking above 69,500, and daily trading volume surged to more than 29 billion. The market reaction was fast and clear.

The signal conveyed by this process is that the current market is treating Bitcoin as a “geopolitical thermometer,” not merely a speculative position. This shift in positioning is itself significant.

A real identity crisis—and why it creates opportunities

Bitcoin is in a rather rare stage: it can’t quite be pinned down as what it is, and the market also can’t give a clear definition.

On the one hand, it has indeed begun to show characteristics of a “safe-haven asset.” In the previous cycle, Bitcoin’s high correlation with software stocks quickly broke after the outbreak of the conflict; the current correlation is now close to zero. It is no longer just an amplified “tech stock substitute.”

But on the other hand, Bitcoin will still rise when messages like “ceasefire” and “de-escalation” appear, and it will fall when the conflict escalates. This is typical risk-on asset behavior—once the political situation deteriorates, it drops. It is hard to simply define it as “digital gold.”

A more accurate description is that today’s Bitcoin is in a transition zone between two sets of attributes. And it is precisely this uncertainty that creates opportunities for investors who understand its structure.

A macro headwind that can’t be ignored

The bearish logic is also clear and worth taking seriously.

Since the conflict broke out, oil prices have risen by about 60%, and Brent Crude has at one point risen to more than 107 per barrel. Such an energy shock would flow directly into inflation levels that are already stubborn, and it would change the Federal Reserve’s rate-cut path. The market currently has almost unanimous expectations that the Federal Reserve will keep interest rates unchanged at its April meeting, leaving limited room for cuts in the near term.

This is crucial for Bitcoin, because liquidity has always been the core fuel for its rise. The bull market from 2020 to 2021 was essentially built on an extremely accommodative monetary environment. When money is plentiful and costs are low, Bitcoin often performs strongly. But when central banks tighten policy— or even just “stay on hold for longer than expected”—this tailwind disappears.

Digital asset manager CoinShares points out that in late March, digital asset investment products saw their first week of outflows in five weeks, with Bitcoin products accounting for outflows of 194 million. The reason is also straightforward: the conflict is dragging on, inflation risks are rising, and interest-rate expectations are shifting.

What investors truly need to watch is not the war itself, but how the war changes the path of monetary policy.

What “smart money” is doing

With signals from both bulls and bears interweaving, institutional capital’s behavior is fairly clear.

On April 6, U.S. spot Bitcoin ETFs recorded net inflows of 471 million in a single day, the strongest performance since late February, and the sixth-largest single-day inflow in 2026. Of this, the assets under management of BlackRock’s iShares Bitcoin Trust (IBIT) have exceeded 54.5 billion, accounting for nearly 60% of the entire U.S. spot Bitcoin ETF market. As of now, cumulative net inflows into U.S. spot Bitcoin ETFs are about 56 billion.

This is not a retail-driven chase-buying frenzy; it is a paced allocation by institutional capital while the broader market is in a wait-and-see mode.

One possible interpretation is that large allocators are viewing the 66,000 to 70,000 range as a “position-building zone.” In institutional memory, Bitcoin has just gone through a historic all-time high of 126,000; entering at roughly 69,000 at this stage produces a risk-reward structure completely different from chasing higher prices at the peak. This price band has genuine asymmetry.

How to understand what happens next

Looking forward from the current point, the outcomes are not symmetrical, but they are not completely unknowable either.

The probabilities currently given by the prediction market are: about 28% for reaching a ceasefire by the end of April, rising to 55% by the end of June, and reaching 76% by the end of the year. This timeline already provides key information by itself: there is unlikely to be a quick resolution in the short term, but achieving some form of solution within a few months remains the baseline scenario.

If this scenario occurs, the market’s path of narrative is relatively clear: oil prices fall, inflation cools, rate-cut expectations are rebuilt, liquidity expands again, and Bitcoin is likely to become the most resilient repair asset in this environment. The very same event that triggers the shock would then drive the repair in the opposite direction, potentially even leading to a stronger rebound.

But if the conflict drags into a stagflation trajectory, things become more complex. Liquidity tightens, capital continues to flow out, and passive deleveraging of leveraged positions in the futures market could further suppress prices. The 50,000 area—repeatedly mentioned—has become the next important support zone.

A more honest answer is that no one can determine how the path will unfold. What investors can truly control is the match between position size and their own judgment, as well as the holding period.

A key variable being overlooked

Beyond the daily war narrative, there is another more structural thread: the U.S. “Strategic Bitcoin reserve.”

When a sitting president proposes adding Bitcoin to a nation’s strategic asset reserve, this will change the long-term supply structure. This is not noise; it is a fundamental shift by the world’s largest economy in how it relates to this asset, carrying clear long-term bullish implications. It’s just that—masked by the conflict itself—this has not yet been fully priced by the market.

As uncertainty gradually fades, the importance of this variable will re-emerge.

Conclusion

Bitcoin is neither a traditional safe-haven asset nor a purely risk-on instrument. A more fitting understanding is that it is in a “transitional state”—on the one hand, it gradually earns credibility through real institutional capital allocation; on the other, it still retains the volatility inherent to emerging assets.

The conflict makes the picture look chaotic, but the underlying signals are not complicated: institutions are buying, the price is still far from the highs, and the final direction of the war will become an important catalyst for the next phase.

The market has always been like this—uncertainty is often the source of opportunity.

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