The crypto market turned red over the weekend as the U.S. bombed military targets on Iran’s Kharg Island, the nerve center of Iran’s oil exports. 2Bitcoin and other crypto prices are facing renewed pressure as Iran threatened to increase its use of upgraded weapons, dragging the total crypto market cap below $2.4 trillion and leaving investors bracing for more turbulence ahead.
What Happened on Kharg Island
10 President Donald Trump posted on Truth Social that the United States Central Command “totally obliterated every MILITARY target in Iran’s crown jewel, Kharg Island.” 3 Trump described the bombing as “the most powerful bombing raids in Middle East history.” The strategic island handles roughly 90% of Iran’s crude oil exports and about 2% of global oil supply.
10Trump also noted that “for reasons of decency,” he chose not to wipe out the oil infrastructure on the island. But he warned he would “immediately reconsider” if Iran blocks the Strait of Hormuz.
1 Iran responded that any strike on energy infrastructure would trigger retaliatory attacks on U.S.-linked facilities. That conditional warning is new and has sent chills through global markets.
Bitcoin price drop after US Iran Kharg Island military strikes 2026
Bitcoin Dips Below $71,000 After Touching $74,000
2 TradingView data show the crypto market cap fell to $2.38 trillion, down from $2.4 trillion the previous day. Bitcoin led the decline, dropping below $71,000 after rising to nearly $74,000.
But here is where it gets interesting. 1After the tanker attacks on March 12, Bitcoin held $69,400. After Kharg Island on Saturday, the low was $70,596. Each selloff is finding buyers at a higher level than the last.
Key Bitcoin levels traders are watching right now:
- Resistance: $73,000 to $74,000 (must break for a rally toward $80,000)
- Support: $70,000 (psychological floor holding for now)
- Danger zone: Below $65,000 could trigger a deeper pullback
18 U.S. spot Bitcoin ETFs have recorded roughly $1.3 billion in net inflows so far in March, potentially marking the first positive month for flows since October. That is a signal. Institutions are buying the dip while retail traders panic. 19 Funding positioning of perpetual futures traders has been negative for the longest period since the bottom of the last major bear market in 2022. Historically, such prolonged negative funding streaks have lined up with local price bottoms.
Iran’s New Supreme Leader Closes the Strait of Hormuz
The geopolitical backdrop is what makes this moment so dangerous for markets.
21 Iran’s state media issued what it said was a statement by Supreme Leader Mojtaba Khamenei, vowing to keep the Strait of Hormuz closed and keep up attacks on U.S. bases in the region. 21 It was the new leader’s first address since he succeeded his father, Ayatollah Ali Khamenei, who was killed in an Israeli strike early in the war.
The Strait of Hormuz is no ordinary waterway. 2The closure of this strait, a chokepoint for about 20% of the global oil supply, has so far been the primary driver of rising oil prices, which is pressuring crypto prices.
7 Oil prices have soared more than 40% since the war began two weeks ago and are up nearly 70% year to date. Some analysts now see oil touching $200 a barrel if the conflict drags on much longer. 7 Iran’s Houthi allies in Yemen may also try to close the Red Sea to commercial shipping, heaping even more pain on global trade.
Why this matters for crypto: Rising oil prices feed inflation, which makes rate cuts less likely. And without rate cuts, risk assets like Bitcoin and altcoins lose the easy-money tailwind that fueled previous rallies.
David Sacks Urges the White House to End the War
In a rare break from the administration’s tone, 38White House AI czar David Sacks said the U.S. should “declare victory and get out” of its war on Iran, a rare instance of a prominent figure in Donald Trump’s administration calling for an exit from the conflict.
34 “We’ve degraded Iranian capabilities massively,” Sacks said on the All-In Podcast. “This is a good time to declare victory and get out.” 37 Sacks described Iran as holding a “dead man’s switch over the economic fate of the Gulf States.” He warned that continued escalation could lead to attacks on desalination plants serving around 100 million people, potentially rendering parts of the Gulf region nearly uninhabitable.
But Trump is in no rush to stop. When asked when the war could end, the president said it would end when he “felt it in his bones.” That lack of a timeline spooked markets further.
31 Sacks also warned that a faction within the Republican Party wants to escalate the war, send in ground troops, and seek regime change. If that faction wins the internal debate, crypto traders should buckle up for more volatility.
What Prediction Markets and Traders Are Saying
Prediction markets paint a sobering picture for anyone hoping for a quick resolution.
48 On Polymarket, the leading outcome for “Military action against Iran ends on…” is “Military action through March 31” at 83%. Only a tiny fraction of traders believe the fighting stops this month. 41 The market tracking when Trump announces an end to military operations currently shows a 75% chance of that happening by June 30.
| Polymarket Prediction | Current Odds |
|---|---|
| Military action continues through March 31 | 83% |
| U.S. ends military operations by June 30 | 75% |
| U.S.-Iran ceasefire by December 31 | 68% |
| U.S.-Iran nuclear deal by March 31 | 3% |
1 Despite selling off on every negative headline, Bitcoin has repeatedly recovered to higher lows, forming a rising floor between roughly $64,000 and more than $70,000 while facing resistance around $73,000 to $74,000. 1 Compared with other assets over the same two weeks, Bitcoin has outperformed gold, the S&P 500, and Asian equities, acting less like a traditional safe haven and more like a 24/7 liquidity pool that absorbs geopolitical shocks faster than other markets.
The crypto market stands at a crossroads. On one side, a widening war threatens oil supplies, pushes inflation higher, and keeps risk appetite on a leash. On the other, Bitcoin keeps showing a stubborn ability to bounce back faster than any other asset on the planet. For investors watching from the sidelines, the message from the market is clear: uncertainty is the only certainty right now. Whether you are holding, buying the dip, or sitting in cash, stay alert and manage your risk carefully. Drop your thoughts in the comments below on where you think Bitcoin goes from here.
