U.S.-Iran Conflict Escalates! U.S. stocks and Taiwan stocks both plummet, Bitcoin rebounds and temporarily stays above 68,000

U.S.-Iran Conflict Weighs on U.S. and Taiwan Stocks, TSMC Falls Below 1,900 Yuan, Precious Metals Also Retreat, Bitcoin Rebounds to $68,000

Ongoing tensions between the U.S. and Iran continue to cause market volatility, with all four major U.S. stock indices closing lower last night, spreading to Asian markets.

According to Liberty Financial, Taiwan stocks opened today (3/4), with flagship stock TSMC dropping 40 yuan at the open, falling below the 1,900 yuan mark, opening at 1,895 yuan. The Taiwan Weighted Index also opened down 94.9 points at 34,228.75.

Led by TSMC’s decline, electronics, traditional industries, and financial stocks mostly fell into the red, while a few sectors like shipping, oil and electricity, and electronic retailing managed to rise against the trend.

Bitcoin Rebounds Against the Trend, Outperforming U.S. Stocks

While traditional financial markets face sell-offs, the cryptocurrency market shows a different trend.

According to reports from Decrypt and CoinDesk, as investors assess the possibility of an extended conflict between the U.S. and Iran over Iran, Bitcoin ($BTC) has outperformed major U.S. stock indices.

Bitcoin is currently trading around $68,062, roughly flat in the past 24 hours, but has gained about $2,000 since U.S. markets opened. It briefly dipped to a low of $66,160 last night but then rebounded strongly.

Precious metals and stocks both declined simultaneously, while former U.S. President Trump announced continued efforts to target Iran.

Meanwhile, despite increased geopolitical tensions, traditional safe-haven assets initially experienced a pullback.

According to Yahoo Finance, gold futures fell as much as 3.6%, reaching about $5,119 per ounce, but have since recovered to $5,188. Silver declined even more, dropping approximately 6.2% to around $83 per ounce.

Yesterday, U.S. President Donald Trump stated at the White House that after the death of Iran’s Supreme Leader Ayatollah Ali Khamenei, the U.S. will continue to strike Iran and target more Iranian high-ranking officials.

International Oil Prices Are a Key Indicator for Crypto Markets, March Rate Cut Likelihood Remains Low

Tensions in the Middle East are directly impacting the global energy supply chain. Jake Ostrovskis, head of OTC trading at crypto market maker Wintermute, pointed out in a report that the most important indicator for cryptocurrencies right now may be international oil prices.

Data from Yahoo Finance shows that Brent crude oil prices rose yesterday, up 4.5% to $81 per barrel, and are currently at $82.07. If Brent crude can stay above $80 for several consecutive days, concerns about inflation will become more pronounced, potentially eliminating the possibility of a rate cut by the Federal Reserve in March.

Meanwhile, CME’s FedWatch tool indicates that the market now assigns only a 2.6% chance of the Fed cutting interest rates by 25 basis points at the next meeting.

Strong Dollar Index Doesn’t Deter Institutional Buying, Bitcoin Awaits Breakout Beyond Bull-Bear Threshold

Cointelegraph analyst Marcel Pechman noted that the dollar index rose to 99.4 yesterday, up from 96.6 three weeks ago. The main reason for the dollar’s strength is investors seeking cash and government bonds as safe havens.

Historical data shows that periods of dollar weakness often coincide with positive returns for Bitcoin, such as during the bull market from March to August 2025.

However, the 30-day correlation between Bitcoin and the Nasdaq 100 has dropped from a peak of 92% a week ago to 69%. Pechman believes that as Bitcoin’s market positioning continues to evolve, relying solely on a strong dollar to predict a Bitcoin crash is unfounded.

Data from SoSoValue shows that since February 24, net inflows into Bitcoin spot ETFs have reached $1.5 billion, indicating accelerating institutional demand. However, traders expect to wait until Bitcoin clearly breaks above $75,000 before concluding that the bear market is over.

Until that target is reached, even with weaker overall market correlations, macroeconomic indicators like the dollar index will continue to exert downward pressure on Bitcoin prices.

Further reading:
Using Cryptocurrency as Emergency Hedge? Iran Exchange Outflows Surge 700% Within Minutes of U.S.-Israel Airstrikes