Middle East conflict escalation | The "oil chain reaction" in the crypto market has just begun

From April 1-3, the US-Iran situation experienced a rollercoaster of "de-escalation → reversal → further escalation." Trump announced victory while threatening to "continue striking hard"; Iran denied requesting a ceasefire, and the Revolutionary Guards launched the 91st wave of counterattacks.

This conflict's true impact on the crypto market is not short-term emotional fluctuations, but rather through the transmission chain of oil prices → inflation → interest rates.

First layer of transmission: oil prices surge

WTI crude oil prices soared from $98 to $104 within an hour after Trump's speech. The IEA warned that the oil supply gap in April will be twice that of March. High oil prices directly push up global energy costs.

Second layer of transmission: inflation expectations rise

UBS pointed out that rising oil prices bring new inflation risks, making the Federal Reserve's stance more cautious. Market expectations for rate cuts in 2026 are rapidly fading—this is a structural negative for overvalued crypto assets.

Third layer of transmission: liquidity tightening

If inflation remains high, the Fed will not only refrain from cutting rates but may even maintain tightening. The "loose liquidity narrative" that supports the crypto market will be thoroughly broken.

April operational strategy

In the short term, the crypto market will heavily depend on the evolution of geopolitical news: worsening situation → risk aversion → market pressure; potential for negotiation breakthroughs → risk appetite recovery → rebound. But in the medium to long term, as long as oil prices stay above $100, the expectation of rate cuts will be hard to restore.

It is recommended to reduce positions and avoid heavy bets on a single direction, focusing on the outcome of the OPEC+ meeting on April 5.

#Gate廣場四月發帖挑戰