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In a world where every geopolitical explosion shakes financial markets, crypto seems strangely unshaken by the recent tensions between Israel and Iran. However, this apparent serenity may only be temporary. How long can greed, an irrational but powerful driver, keep the sector afloat?
In Brief
The crypto market maintains its greed despite Israel-Iran tensions.
Bitcoin remains strong, but the 100,000 $ threshold is crucial.
A prolonged conflict could trigger a wave of fear.
A Surprisingly Resilient Greed
Since the Israeli strikes on Iran, traditional markets have been trembling while Bitcoin shows remarkable resilience. The Crypto Fear & Greed Index, a true barometer of emotions in the crypto market, remains at a surprising level of greed (60), despite a slight drop in Bitcoin, now stabilized around $105,222. This steadiness is all the more surprising as the current situation oddly recalls that of April 2024, when a direct Iranian retaliation caused BTC to falter by 8.4%.
Why this paradox? In reality, crypto investors display an almost provocative confidence in Bitcoin, regarded as a safe-haven asset amid traditional monetary and geopolitical crises.
Anthony Pompliano, a crypto entrepreneur, does not hesitate to call Bitcoin “relentless,” highlighting once again its ability to hold firm against geopolitical storms.
However, this resilience should not mask real risks. Over $1.74 billion in long positions hang on a critical threshold: the psychological barrier of $100,000. The slightest breach could trigger a domino effect with dramatic consequences.
Between Euphoria and Caution: The Limit is Fragile
Past experience shows that this greed could quickly turn into fear. Last year, after peaking at 72 at the start of the Israeli-Iranian hostilities, the Crypto Fear & Greed Index plunged sharply to 43. Bitcoin, currently flirting with its historic highs, could face the same scenario if tensions persist.
On the other hand, Ether, often seen as more sensitive to market shocks, has already undergone a significant correction of nearly 11%. This divergence reminds investors that crypto is far from an indestructible monolith.
Bitcoin ETFs, for their part, continue to attract massive inflows, a sign of persistent institutional confidence, while Ether ETFs now face withdrawals after a prosperous period of 19 consecutive days of inflows.
Towards a Decisive Test for Cryptos
The key now lies in the duration and intensity of the Israeli-Iranian tensions. If the conflict prolongs or intensifies, greed could quickly give way to widespread fear, forcing investors to reconsider their positions.
The Fear and Greed Index reflects this deceptive calm in the crypto market. Za, a renowned analyst, remains cautious: “Bitcoin doesn’t seem worried for now, but this apparent calm may hide latent volatility.” Recent history indeed shows that crypto investors’ optimism can abruptly shift due to a sudden geopolitical escalation.
Ultimately, the current resilience of cryptocurrencies against the Israeli-Iranian conflict may be a temporary illusion. Caution is therefore advised: closely monitoring the conflict’s evolution and staying ready to adjust positions remains the best strategy to navigate this particularly uncertain period even if long-term holders keep buying.
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Fascinated by Bitcoin since 2017, Evariste has continuously researched the subject. While his initial interest was in trading, he now actively seeks to understand all advances centered on cryptocurrencies. As an editor, he strives to consistently deliver high-quality work that reflects the state of the sector as a whole.
DISCLAIMER
The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.
