As tensions flare once again between Iran, Israel, and the U.S., social media, especially on crypto social media X (or Crypto Twitter), fears that Tehran could shut down the Strait of Hormuz, a vital oil chokepoint. Such a move, many worry, could send oil prices and global inflation soaring and roil financial markets, including bitcoin.

However, those concerns may be exaggerated, according to some observers.

Early Saturday, Israel and the U.S. launched airstrikes on Iran, aiming to dismantle the nation’s nuclear facilities and missile capabilities after failed negotiations. Iran retaliated by firing ballistic missiles at Israel and the U.S. bases in the region, escalating fears of a full-blown military conflict.

This sparked jitters in the crypto market, the only venue open for investors to express fear and risk, while traditional markets stay closed over the weekend.

Bitcoin BTC$64,751.25, the leading cryptocurrency by market value, dropped to $63,000 from around $65,600 before rebounding to $65,000. Oil-linked futures on Hyperliquid surged more than 5%.

Hormuz fears

The Strait of Hormuz is a chokepoint (21 miles wide at its narrowest point) between Iran to the north and Oman to the south, and facilitated about 20 million barrels of oil shipments each day in 2024, according to the U.S. Energy Information Administration (EIA).

Naturally, amid simmering tensions, crypto accounts on X are worried that Iran may close the Strait of Hormuz, choking off oil supplies.

“If a direct conflict between the United States and Iran has begun, this isn’t just geopolitics. It’s a global economic event. If the Strait of Hormuz is threatened, oil could spike toward $120–$150,” an X handle called @Crypto_Diet said.

This could lead to an inflation shock, market sell-offs, a dollar surge, and depreciation in emerging-market currencies, the post added.

Several more accounts have posted similar views, with some savvy geopolitical experts sharing these concerns.

“Oil prices had already climbed to six-month highs ahead of the strikes. Iran is a founding OPEC member and the Strait of Hormuz, through which roughly 20% of global oil passes, is now directly implicated,” Geopolitical Strategist Velina Tchakarova said.

On top of that, some news outlets are already reporting that several oil majors, including trading houses, have suspended oil and fuel shipments through the strait.

Outright closure unlikely

Some observers, however, argued that an outright closure of the strait is not in Iran’s best interests and may be geographically impossible.

According to Daniel Lacalle, a PhD economist, fund manager, and chief economist at Tressis, Iran currently produces 3.3 million barrels per day of oil, but exports just half of that, which almost entirely goes to its ally China.

“It would shoot itself in the foot,” Lacalle said, downplaying fears of an eventual Iranian shutdown of the strait.

He added that OPEC members could quickly offset any potential disruption to oil supplies from Iran, while stressing that the United States, by itself, is the world’s largest oil producer.

In other words, any spike in oil prices could be measured and temporary.

The other aspect to consider is Geography. While the strait is split roughly in the middle between Iran and Oman, the shipping lanes are predominantly in Omani waters. It’s because water on the Iranian side is said to be shallower, while on the Omani side, it is deeper and better suited for the movement of large oil tankers.

So, technically, ships could pass through Oman’s yard, which means Iran’s closure of its territory may not have a big impact on supplies.

“Most waterways are in Oman, not Iran,” Energy Market Expert Dr. Anas Alhajji said on X.

“Hormuz strait has never been blocked despite all wars – It cannot be blocked. Too wide. Well protected,” he added.

All things considered, the odds of Iran shutting the strait and choking off oil supplies are low. That said, an all-out war can still trigger widespread risk aversion, potentially driving bitcoin below the widely watched $60,000 support level.

Meanwhile, bitcoin’s price chart also signals a potential for deepening of the bear market ahead amid the Middle East crisis.

US and Israeli military strikes in Iran triggered a $6.5 million loss for one cryptocurrency prediction market trader.

Meanwhile, the attacks generated hundreds of thousands of dollars in profit for others.

Iran Bombing Fuels Six Figure gains and $6 Million Loss on Polymarket

The financial fallout on the decentralized platform Polymarket underscores the rapid capital shifts tied to geopolitical betting.

Blockchain analysis reveals that a single trader, operating under the pseudonym anoin123, suffered a total wipeout of more than $6.4 million.

The trader had systematically placed massive wagers, fading the likelihood that President Donald Trump would authorize direct military intervention against the Islamic Republic.

When munitions hit Tehran and other Iranian cities, those contracts became worthless.

Conversely, the military escalation generated profits for a handful of persistent Polymarket users. A trader known as Vivaldi007, who began buying shares on February 8, anticipating a joint attack, realized a total profit of $385,000.

Notably, the trader had absorbed losses on earlier contracts as previous target dates passed without incident before capitalizing on Saturday’s strikes.

Meanwhile, the most closely scrutinized transaction involves a cryptocurrency wallet dubbed “Roeyha2026.”

According to the blockchain analytics platform Lookonchain, the wallet was funded 11 hours before the bombing campaign commenced. The anonymous user wagered $50,000 that a US strike on Iran would occur before March 1.

The attacks had immediate impact on crypto prices, with many assets tumbling before staging modest recoveries.

As it happened with a few other global situations in the past several months, a group of suspected insiders seemingly knew what was going to transpire and profited substantially.

Recall that Israel and the US carried out organized strikes against Iran on Saturday, and Bubblemaps outlined that a group of wallets made a total of $1.2 million betting on these developments hours before they happened.

JUST IN: 🇮🇷 🇺🇸 Six suspected insiders made $1.2M betting on a US strike on Iran

Most of these wallets:

• were funded in the last 24h
• specifically bet for February 28
• bought “yes” hours before the strike pic.twitter.com/n3G6OIEOXt

— Bubblemaps (@bubblemaps) February 28, 2026

Given the precision in their actions – funding the wallets in the past 24 hours before the events unfolded, choosing specifically February 28, and betting on “yes” shortly ahead of the strikes, the likely conclusion is that they had inside knowledge of what took place in the Middle East on Saturday morning.

Recall that at first reports emerged that Israel had initiated strikes against Iran, and then ordered a state of emergency within its borders, expecting retaliation. Then, US President Donald Trump confirmed that his country was also involved.

The POTUS doubled down in the following hours, categorizing the attacks as a “major combat operation.” It’s worth noting that Iran indeed retaliated by counter-attacking several US allies, such as Kuwait, the UAE, Qatar, and Bahrain.

The initial attacks from the morning harmed the cryptocurrency markets immediately. Bitcoin dumped from $66,000 to $63,000 in minutes, while most altcoins followed suit with 2-4% declines in less than an hour.

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Nevertheless, BTC has recovered some ground since then and currently trades close to $65,000. ETH is down to $1,900, while BNB and XRP continue their fight for fourth place in terms of market cap.

Mark Karpelès thought he had a reasonable ask.

The former CEO of defunct exchange MtGox, operating under his GitHub handle MagicalTux, submitted a pull request to Bitcoin Core over the weekend proposing a hard fork (a fundamental change in code that splits the blockchain) that would let 79,956 BTC be redirected from the address they’ve been sitting in since 2011.

At current prices, that’s roughly $5 billion in bitcoin that hasn’t moved in 15 years.

The proposal was narrow, with just under 60 lines of code. A single consensus rule change that would substitute one public key hash for another when validating transactions from the theft address, allowing the MtGox trustee to spend the coins and route them into Japan’s existing court-supervised rehabilitation process.

Read more: Mt Gox: The History of a Failed Bitcoin Exchange

The activation height was set to infinity, meaning nothing would happen unless the community explicitly agreed to turn it on.

It lasted about 17 hours.

The forum was auto-closed even before a discussion took place, with bitcoiners suggesting that Karpelès submitted a pull request directly when he should’ve first discussed the changes on the Bitcoin development list. Some of them said that Karpelès should first propose this as an official Bitcoin Improvement Proposal (BIP).

The people it was supposed to help rejected it, too. Several MtGox creditors said publicly on X that they didn’t want Bitcoin’s rules rewritten on their behalf. The network’s guarantee that private keys equal ownership matters more to them than getting their coins back.

Code is the law

Karpelès had anticipated the objections and listed them himself in the proposal.

The theft is unambiguous, and the coins haven’t moved in 15 years. A legal framework to distribute them already exists. The scope targets one address. Every argument for exceptionalism was there.

Once Bitcoin redirects coins for any reason, the question stops being whether it can and starts being when it will do it again.

Bitfinex victims, DeFi hack victims, and anyone who lost coins to a documented theft could cite this as precedent and seek the same remedy for their incidents. The line between one justified exception and a general mechanism is exactly the kind of subjective boundary Bitcoin was built to avoid.

This is not to say a change in code didn’t happen before.

Previous emergency interventions, such as the 2010 value overflow bug or the 2013 chain split, involved technical failures that threatened the network itself. This was different. The network was working exactly as designed. The proposal was asking it to work differently for one group of people, however sympathetic their case.

The pull request is now closed. $5 billion in bitcoin remains frozen at the same address it’s been at since 2011. And the creditors who might have benefited chose the principal over the payout.

Ultimately, Bitcoin’s fundamental principle of “code is the law” prevailed.

Six Polymarket accounts earned roughly $1.2 million after correctly betting that the U.S. would strike Iran on Feb. 28, according to blockchain analytics firm Bubblemaps.

In a post on X, Bubblemaps said most of the wallets were funded within 24 hours of the attack and bought “Yes” shares in the “U.S. strikes Iran by February 28, 2026?” market just hours before explosions were reported in Tehran and other cities.The accounts had no activity beyond these predictions.

The strikes followed a televised address by U.S. President Donald Trump announcing what he called “major combat operations,” targeting the country’s missile, naval, and nuclear infrastructure. The attack saw bitcoin’s price drop while oil futures on Hyperliquid rose.

One Polymarket account Bubblemaps pointed to purchased more than 560,000 “Yes” shares at about 10.8 cents each, a position that paid out near $560,000 after the market resolved at $1. Another account bought nearly 150,000 shares at 20 cents, turning a six-figure profit. All six profiles were created in February, according to Polymarket data.

Trading volume on the Feb. 28 contract reached nearly $90 million, part of more than $529 million wagered across related strike-date markets since December.

Bubblemaps published a visual map showing the six wallets clustered together and funded through similar paths.

The trades land as U.S. regulators weigh how to police insider activity on prediction markets. This week, rival platform Kalshi said it suspended and fined two users for insider trading, including a visual effects editor for MrBeast’s “Beast Games” who allegedly traded on knowledge of show outcomes.

Kalshi, which is registered with the Commodity Futures Trading Commission as a designated contract market, said it has investigated about 200 cases and has more than a dozen active probes.

The CFTC issued an advisory noting the enforcement actions and warned that insider trading on event contracts may violate U.S. law. Chairman Mike Selig called exchanges the “first line of defense.” Kalshi banned the employee for two years and fined him more than $20,000. In a separate case, a political candidate was penalized for betting on his own race.

More recently, Polymarket traders have appeared to insider trade a market on insider trading itself. Blockchain sleuth ZachXBT last week teased he would publish the findings of an investigation into a crypto platform, which ended up being Axiom, whose employees he believed used non-public information to trade.

Teasing the investigation was coming, however, led to the creation of a Polymarket contract on which company would be named. Some clearly knew the answer on which company was under investigation, with Lookonchain identifying 12 wallets that heavily bet on Axiom ahead of the reveal.

Some observers noted that even if Iran controlled 5% of global hashrate, the network would continue functioning without disruption.

Bitcoin mining in Iran is back in the spotlight after a viral X post on February 27 claimed the country runs a $1 billion operation that could be wiped out.

The debate has split crypto observers, with some warning of a temporary hashrate shock and others dismissing the claims as exaggerated fear, uncertainty, and doubt (FUD).

Iran’s Mining Footprint and the Strike Scenario

The discussion began when independent analyst Shanaka Anslem Perera posted that Iran mines Bitcoin at a theoretical cost of $1,320 per BTC using heavily subsidized electricity and then selling it at the current price near $68,000 to extract what he described as a 50x gross margin.

He alleged that around 700,000 mining rigs consume roughly 2,000 megawatts daily, much of it tied to operations linked to the Islamic Revolutionary Guard Corps, or IRGC.

Perera tied the argument to sanctions, saying Bitcoin allows Iran to convert restricted energy resources into liquid capital beyond the reach of SWIFT prohibitions.

A January 16 report by Chainalysis found that Iran’s total crypto activity exceeded $7.78 billion in 2025. Furthermore, the report said addresses linked to IRGC facilitation networks received more than $3 billion last year, up from just over $2 billion in 2024, and that activity often spiked during military or political crises.

Nonetheless, critics quickly challenged the mining cost assumptions, with analyst Dasha calling the $1,320 figure “100% fake news,” arguing it relies on household electricity rates that cannot be achieved in practice due to blackouts and shortages.

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Hashrate Shocks Are Not New

The objections did not stop there, as miner ZynxBTC dismissed the concern entirely:

“Even if Iran controlled 5% of global hashrate (it doesn’t), and it went offline, the network would continue functioning normally.”

Recent U.S. events support that argument. Earlier in the year, the network continued operating even after a severe winter storm forced major Texas miners offline, pushing the hashrate down from 1.133 ZH/s to 690 EH/s in just a couple of days.

However, Perera argued that grid failure differs from voluntary shutdown. According to his analysis, with tensions brewing in the Middle East, a 7-to-10-day air campaign targeting Iranian military infrastructure would likely collapse electricity generation by an estimated 30% to 50%.

He insisted that mining rigs require continuous power, and even brief outages could destroy active operations. As such, he postulated that a strike on Iran’s already fragile grid could see the country’s estimated 2% to 5% share of the global hashrate drop to zero within days, triggering a difficulty adjustment that would extend block times and temporarily spike transaction fees. As CryptoPotato reported, the US and Israel have already launched strikes on Iran earlier today.

Still, others argued that the Bitcoin network has withstood even larger shocks, with researcher Furkan Yildirim noting that China removed more than half of the global hashrate in 2021, yet the network soon adjusted as miners relocated.

“An Iranian grid failure would be a rounding error by comparison,” he tweeted.

A group of 11 US senators has asked federal authorities to investigate whether crypto exchange Binance is complying with US sanctions and Anti-Money Laundering (AML) requirements, citing recent reports.

In a letter on Friday to Treasury Secretary Scott Bessent and Attorney General Pamela Bondi, the lawmakers urged a “prompt, comprehensive review” of the exchange’s compliance controls and its adherence to settlement agreements reached in 2023.

The senators pointed to allegations that approximately $1.7 billion in digital assets flowed through Binance to Iranian entities linked to terrorism, including groups connected to the Houthis and the Islamic Revolutionary Guard Corps. Investigators also reportedly identified more than 1,500 accounts accessed by users in Iran and potential activity connected to Russian sanctions evasion.

According to the letter, some Binance compliance staff who uncovered suspicious transactions were later dismissed, and law enforcement agencies said the exchange had become less cooperative in providing customer information.

Related: Binance stablecoin reserves have sunk 19% since November

Senators warn Binance products could enable sanctions evasion

Senators Chris Van Hollen and Ruben Gallego, joined by Angela D. Alsobrooks, Andy Kim, Raphael Warnock, Tina Smith, Catherine Cortez Masto, Mark R. Warner, Elizabeth Warren, Jack Reed and Lisa Blunt Rochester, signed the letter.

They also raised concerns about newer products, including payment cards launched in parts of the former Soviet Union and partnerships tied to stablecoin initiatives, which they warned could facilitate sanctions evasion.

The senators asked the agencies to report by March 13 on any steps taken to examine the exchange’s conduct.

On Tuesday, Senator Richard Blumenthal, ranking member of the Senate Permanent Subcommittee on Investigations, also launched a congressional inquiry into Binance. He sent a letter to Binance CEO Richard Teng requesting documents and internal records related to the exchange’s sanctions controls.

Related: Binance confirms employee targeted as three arrested in France break-in

Binance denies Iran-linked transaction claims

In a statement to Cointelegraph this week, Binance rejected allegations that its platform facilitated illicit transactions, saying it identified and reported suspicious activity to authorities and does not allow Iranian users. A company spokesperson said recent media coverage misrepresented the exchange’s operations.

Last week, the exchange also disputed a report claiming it processed more than $1 billion in Iran-linked transfers and denied dismissing investigators over the issue.

Teng has also criticized a Wall Street Journal report alleging $1.7 billion in Iran-related activity, calling it defamatory and seeking a retraction.

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