Crypto Traders on Tenterhooks as Oil Prices Signal Risks

h7vp5v3tkxmg9oq(lao)]4ff_media_dl_1.png BloombergArticle content(Bloomberg) — With 24/7 crypto markets having already digested US-Iran tensions over the weekend, digital-asset traders are on shaky ground as they assess potential contagion risks from crude oil price moves when US markets open on Monday.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentBitcoin and other cryptocurrencies already took a hit on Saturday after the US announced it had begun a bombing campaign against Iran. A cautious rebound followed news that Iran’s Supreme Leader Ayatollah Ali Khamenei had been killed, but prices remained little changed from Friday’s levels. Tehran responded with a wave of strikes against Israel, as well as US bases and other targets in states including Saudi Arabia, Qatar, the United Arab Emirates, Kuwait and Bahrain.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentBitcoin was up roughly 0.7% to about $66,150 as of 6:22 a.m. in London on Monday. The conflict shows no signs of abating, as residents in Dubai and Abu Dhabi reported hearing blasts Monday morning, while Al Jazeera reported the same in Doha.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentTraditional markets in Asia offered a preview of what might be expected throughout the day as investors react to the latest news of conflict in the Middle East. Benchmarks including Japan’s Nikkei 225 and Hong Kong’s Hang Seng Index fell, while oil saw its largest price surge in four years.Article content“The focus is mainly on oil this morning, with all eyes on the developing Strait of Hormuz situation,” said Caroline Mauron, co-founder of Orbit Markets, referring to disruptions to trade through the critical Gulf waterway. “Crypto is a sideshow for now and will remain so as long as it stays in the $60,000 to $70,000 range of the past few weeks.”Article contentHigher oil prices would likely weigh on cryptocurrency prices, which are sensitive to expectations for US Federal Reserve policy. Inflation driven by higher energy costs could push back expectations for the next rate cut, hurting risk assets. Crypto has tended to trade more in line with equities than haven assets such as gold.Article contentArticle contentHaven assets have surged in the wake of the bombings. Yields on 10-year Treasuries fell to the lowest level since October 2024, while gold rose 1.4% to about $5,350 an ounce Monday morning.Article contentThe US dollar strengthened the most among its Group-of-10 currency peers, climbing in early Asia trading amid expectations it will remain an effective hedge against higher energy prices.Article contentIn the crypto world, tokenized assets had already priced in the Middle East conflict for oil, gold and silver. Perpetual swap futures — contracts without an expiration date — linked to those commodities were up over the weekend on Hyperliquid, a 24/7 trading venue. Article contentContracts for gold rose 1.36% to $5,354.10 an ounce Monday morning, while those for oil and silver edged downward. Article content“Since the escalation in Iran, crypto has clearly taken a back seat to traditional geopolitical hedges,” said Charlie Sherry, head of finance at BTC Markets. “In periods of geopolitical stress, capital rotates into hard assets, not into high-beta risk proxies.”Article contentThat caution can be seen in the Bitcoin options market, where roughly $1.9 billion of puts are concentrated at the $60,000 strike price on Deribit, signaling persistent demand for downside protection.Article contentHowever, the absence of follow-through selling is notable, according to Sherry.Article content“When markets stop going down on bad news, it can signal seller exhaustion and the potential for a short-term bottom,” he said. “That is not confirmation of a trend reversal, but it is a condition to monitor.”Article content(Updates with timestamp, latest on strikes)Article contentTrending The (high) opportunity cost of paying off your mortgage early Mortgages Trump Urges Iran Leadership Change as Report Points to Talks PMN Business What's at stake for oil markets as Trump strikes Iran Oil & Gas Stocks Drop, Oil and Gold Advance on Iran Crisis: Markets Wrap PMN Business Feds to invest millions in startup accelerator to boost Canadian defence and dual-use companies Innovation Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. 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