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Macro risks mount as Ukraine adds to oil market uncertainty

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'Murban crude oil' surges past $100, posing risk to bitcoin and risk assets

Ukraine has complicated President Donald Trump’s efforts to stabilize oil markets amid the Iran war, amplifying risks for financial markets, including cryptocurrencies.

For nearly a month, markets have been gripped by a single concern: the Iran war. Disruptions in the Strait of Hormuz – a critical oil chokepoint – have driven prices sharply higher, stoking fears of sticky inflation, a risk-off shift, and renewed Fed rate hikes.

To cool things down, the Trump administration quickly lifted sanctions on Russian crude for the short term, opening the tap to compensate for oil supply disruptions caused by the Iran war.

It came across as a solid plan to stabilize energy markets until Ukraine blew it up.
This week, Ukraine launched drone strikes on ports and refiners in Russia’s Leningrad, leading to what one observer described as “the most serious threat” to the country’s oil exports since Putin’s full-scale invasion of Ukraine in 2022.

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The damage is significant, with roughly 40% of Russia’s oil export capacity offline. Oilprice.com editor Michael Kern described it as “a logistics problem first – and a supply problem second,” underscoring that moving oil to buyers is now as difficult as producing it.

“In conjunction with the war in the Middle East and de facto closure of the Strait of Hormuz and subsequent oil/LNG production outages, the Russian disruption adds a fresh element to already sky-high oil prices,” Kern noted.

In other words, oil prices may remain elevated longer than initially expected. For risk assets, including bitcoin and other cryptocurrencies, that’s an issue because higher sticky energy prices could lead to sticky inflation, potentially putting pressure on global central banks to raise borrowing costs and drain liquidity.

Traders are already prepping for a potential Fed rate hike in the short term. According to Bloomberg, flows in the options market tied to overnight interest rates indicate traders are wagering on a rate increase within two weeks.

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Taken together, these factors suggest bitcoin’s recent resilience may face tests, with the $65,000–$75,000 range vulnerable to a downside break.

At press time, bitcoin traded near $68,500, down nearly 2% over the past 24 hours, according to CoinDesk data. WTI oil, which slipped nearly 10% to $83.95 per barrel on Monday, has since bounced back to $93.50. Brent crude is once again trading above the $100 mark.

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Crypto World

Investors yank $171 million from BTC ETFs in largest single-day outflow in three weeks

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Investors yank $171 million from BTC ETFs in largest single-day outflow in three weeks

Institutional demand for bitcoin appears to be cooling after a strong start to the month.

On Thursday, investors withdrew a combined $171.12 million from the 11 U.S.-listed spot bitcoin exchange-traded funds, marking the largest single-day outflow in just over three weeks, according to data from SoSoValue. BlackRock’s IBIT saw $41.92 million in outflows, while funds such as FBTC, GBTC, BITB and ARKB each recorded withdrawals in the $20 million to $30 million range.

The recent pullback follows a period of robust inflows, with these funds attracting more than $2 billion between late February and mid-month. Since then, momentum has slowed, with just $95.8 million in inflows last week and net outflows of $70.71 million so far this week.

The moderation in flows may point to a pause in institutional accumulation, with investors adopting a more measured approach to these ETFs. Launched in January 2024, the funds allow market participants to take exposure to bitcoin without requiring direct ownership.

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The slowdown in demand raises questions about how long bitcoin can maintain resilience near $70,000 amid broader macroeconomic shocks.

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Bitcoin Whales Bought up 61K BTC In a Month Amid Global Uncertainty

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Bitcoin Whales Bought up 61K BTC In a Month Amid Global Uncertainty

Large Bitcoin holders accumulated 61,568 more Bitcoin over the past month against the backdrop of escalating conflict in the Middle East and macroeconomic uncertainty. 

Whales and sharks, defined as those holding between 10 and 10,000 Bitcoin (BTC), have increased their holdings by 0.45%, while wallets with under 0.01 Bitcoin have added 0.42%, or 213 BTC, over the past month, Santiment said in an X post Thursday.

The figures support recent data showing that Bitcoin exchange outflows have persisted throughout March, indicating that Bitcoin holders are accumulating rather than looking to sell. 

Santiment analysts added that whale accumulation could be a “promising sign” of an eventual breakout from the range. 

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“Ideally, the ranging pattern will break upwards when large wallets are accumulating, while retail is dumping. This has historically been a very reliable pattern to signal the start of bull cycles,” the analysts said.

Source: Santiment

Tensions in the Middle East escalated in February after the US and Israel launched strikes against Iran. Iran retaliated against several neighboring countries, and the conflict has continued since.

Some whales wait for breakout; small holders driven by FOMO

Some Bitcoin whales are taking a different approach. 

On March 19, two Bitcoin whales moved tens of millions of dollars to exchanges as Bitcoin fell and energy prices jumped after attacks on Gulf oil and gas infrastructure deepened during the Iran conflict.

Dominick John, an analyst at Zeus Research, told Cointelegraph that the whales who have been accumulating in the background are likely preparing for the next breakout.

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“Whales are scooping up BTC because they’re positioning ahead of a potential breakout, quietly stacking during consolidation periods. Small wallets are chasing the momentum, driven by FOMO during uptrends and the fear of missing the next leg up,” he said.

Related: Binance says US midterms could boost Bitcoin and stocks

“Whales tend to buy in waves, so accumulation could continue if the range holds and macro conditions stay supportive. On the other hand, if retail FOMO overheats, we could see a pause or slight sell-off before the next accumulation phase,” John added.

Fear and greed index in “extreme fear”

Meanwhile, investor sentiment remains deeply uncertain. The Crypto Fear & Greed Index returned a score of 13 on Friday, firmly in “extreme fear” territory.

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Cryptocurrencies, Adoption, Social Media, Whale
The Crypto Fear & Greed Index has been firmly in “extreme fear” territory. Source: alternative.me

Thursday’s score was 10, and both the prior week and the month of February averaged “extreme fear” ratings as well, according to the index.

Magazine: Banks want to run Vietnam’s crypto exchanges, Boyaa’s $70M BTC plan: Asia Express