Safe haven?
The action is fleeting, but bitcoin currently continues to hold just above $70,000 even as other risk assets sell off across the board.
Helping to send inventories down, crude oil prices are up more than 10%, approaching $100 a barrel. barrel due to concerns about the Strait of Hormuz – a key route for oil tankers.
“Stopping Iran worries me more than oil prices,” President Trump said Thursday. Meanwhile, in his first public statement since being named Iran’s supreme leader, Mojtaba Khamenei said the Strait of Hormuz should remain closed.
“It’s becoming clear to everyone that the Strait is far from under control and potentially uncontrollable without serious concessions to Iran, boots on the ground or huge military risks,” said Quinn Thompson, founder of Lekker Capital. “Things get lopsided from here, and when your back is against the wall, volatility rises.”
Nearing midday on the East Coast, the Nasdaq is near session lows, down 1.6%, and the S&P 500 is down 1.2%.
Erased from the front pages thanks to Iran, but still of great concern are the continued worries about a collapse in private credit. Morgan Stanley ( MS ) was the latest in a growing line of financial giants to cap redemptions — this one at its $8 billion North Haven Private Income Fund. Shares of Morgan Stanley fell 4% on Thursday, leading declines in the financial sector. JPMorgan, Citigroup and Wells Fargo were lower by closer to 3%.
In private equity, KKR, Apollo Global and Ares Management all saw declines of 3% to 4%.
Gold, meanwhile, fell 0.6% and the 10-year US Treasury yield was three basis points higher at 4.23%.
Oil drives markets
Oil has become the main driver behind crypto prices, according to CoinShares head of research, James Butterfill. “The dominant variable in global asset pricing is no longer the labor market. It is oil — and the geopolitical crisis that underlies it,” he said in a note. He argued that the government’s latest US payrolls report, which missed expectations, would normally have pressured markets to price in faster rate cuts by the Federal Reserve, but the reaction was muted as investors focused instead on rising energy costs linked to the conflict in the Middle East.
Despite Thursday’s pullback, bitcoin has remained relatively resilient despite rising geopolitical tensions and broader market uncertainty, holding close to the $70,000 level even as investors reassess global risks.
The reason may be that large investors are increasingly seeking more than simple exposure to bitcoin’s price, according to Dom Harz, co-founder of layer-2 blockchain BOB. “Institutions want more than exposure to bitcoin and are increasingly looking for the infrastructure designed to unlock Bitcoin’s financial utility,” he wrote in a note, pointing to growing interest in bitcoin-based financial applications that can allow users to spend, save and earn money using the network.
