Global asset markets are experiencing extreme volatility following U.S. and Israeli military operations against Iran, leaving investors on edge.
The Middle East crisis pushed bitcoin from $63,000 to $70,000 in a short period while driving gold above $5,300. Both traditional safe-haven assets and digital assets classified as risk assets swung simultaneously. Further military actions and oil price movements are now seen as key variables determining market direction.
Bitcoin Plunges After Airstrikes, Then Rebounds Above $70,000
While traditional financial markets were closed over the weekend, the 24-hour cryptocurrency market absorbed the initial shock.
Bitcoin plunged from $65,000 to $63,000 immediately after news of U.S. airstrikes on Iran broke. The sharp decline reflected heightened risk aversion amid fears of escalating conflict.
However, sentiment shifted dramatically following reports of Iranian Supreme Leader Ayatollah Ali Khamenei's death. Expectations spread that "the war could end early," and bitcoin recovered to $68,000.
The rebound continued. Bitcoin briefly surpassed $70,000 on Monday morning, reaching $70,044 before settling around $69,000. Major altcoins including Ethereum and Ripple also rose.
"Most traders view the economic impact of this conflict as limited," said Marcus Thielen, analyst at 10X Research. The rally was also supported by more than $800 million in net inflows to U.S.-listed spot bitcoin ETFs and Strategy, led by Michael Saylor, purchasing over $200 million in additional bitcoin.
Gold Surges 2% Intraday to $5,297 Per Ounce
Gold, the traditional safe-haven asset, also reacted immediately. According to Reuters, spot gold closed at $5,297 per ounce as of 1:30 p.m. local time on the 2nd, up 0.4%. It had surged more than 2% during the session. Gold futures on the New York Mercantile Exchange also rose more than 1%.
However, gold prices retreated from intraday highs as profit-taking emerged. Uncertainty remains over whether the conflict will be prolonged or end as a short-term clash.
"Whether follow-up attacks continue for weeks is the key variable," David Meger, director of metals trading at High Ridge Futures, told Reuters. "This uncertainty is supporting gold prices."
The dollar also strengthened. The ICE Futures U.S. Dollar Index rose 1%, reflecting safe-haven currency demand.
Oil Price Surge Concerns; Exchange Rate Could Approach 1,500 Won
Oil prices are another source of market anxiety. According to TASS on the 2nd, Iran's Islamic Revolutionary Guard Corps threatened to "burn every passing ship" and intensified its blockade of the Strait of Hormuz, a critical chokepoint for Middle East oil shipments. This put upward pressure on international oil prices during the session. Brent crude and West Texas Intermediate futures rose 3-4% at one point, approaching the mid-$80s per barrel.
Experts warn that "if passage through the strait is actually disrupted, oil prices could surge rapidly." This would deal a direct blow to South Korea's economy, which depends on Middle Eastern oil for approximately 70% of its supply.
Currency markets are also reacting sensitively. Risk aversion combined with dollar strength is putting upward pressure on the won-dollar exchange rate. Some market experts predict that "if Hormuz shipping disruptions last more than a month, the exchange rate could exceed 1,480 won and approach 1,500 won."