BTC, ETH prices: How geopolitical conflicts affected the crypto market in history

The front line: Why crypto reacts first to global conflicts

When geopolitical tensions boil over, the cryptocurrency market is frequently the first responder to investor sentiment. As digital asset exchanges never close, they absorb the immediate shock of breaking news that occurs on weekends or after-hours for traditional stock exchanges.

This then leads to sharp, short-term volatility. Investors may ‘de-risk’ by selling liquid assets like BTC and ETH to move into cash or gold until the scale of a conflict becomes clearer.

Case studies of crypto market reactions

2022: The Russia-Ukraine invasion

In February 2022, BTC plummeted from approximately $39,000 to $34,322 within hours of the invasion. However, this ‘risk-off’ move was short-lived. By March 1, BTC had surged back to $44,000. 

This recovery was driven by a new narrative: BTC as a tool for financial sovereignty, as both Ukrainian refugees and sanctioned individuals turned to decentralized assets for cross-border transfers.

2023: The Israel-Hamas escalation

When conflict erupted in October 2023, BTC initially slipped to $27,000. Unlike the 2022 shock, the market stabilized quickly. Within weeks, the focus shifted back to the impending spot ETF approvals in the US. 

This period marked a turning point where internal industry milestones began to outweigh the volume of geopolitical headlines, with BTC eventually climbing toward $35,000 by the month's end.

2025 to 2026: Trade wars and modern volatility

2025: The tariff-induced 'risk-off' phase

In April 2025, US President Donald Trump announced the ‘Liberation Day’ tariffs, sparking a global flight from risk that proved to be more severe than previous military shocks. 

BTC dropped 10% to below $78,000, while ETH saw its largest three-day loss since late 2022, falling 25%. Traders and market watchers learned another lesson in how global trade barriers can impact crypto liquidity more directly than localized kinetic warfare.

2026: The ‘4 to 5 week’ campaign outlook

The most recent test arrived in February 2026, with the commencement of ‘Operation Epic Fury’. BTC initially dropped from $68,000 to approximately $63,000. However, by March 1, BTC had already climbed back above $67,000.

On March 2, Trump stated that the military campaign was projected to last four to five weeks. Historically, markets dislike uncertainty more than conflict itself; a defined timeline may allow traders to price in a ‘war premium’, potentially stabilizing BTC and ETH as the mission progresses.

Bitcoin’s ‘digital gold’ identity crisis

Historical data from 2022 to 2026 suggests that while BTC still experiences ‘liquidity flushes’ during the early phases of a conflict, recovery times have shortened. As institutional adoption via ETFs has grown, the digital asset is increasingly caught between two identities: a high-growth risk asset and a censorship-resistant ‘digital gold’.

When traditional markets opened after the announcement of ‘Operation Epic Fury’, the divergence between ‘physical safety’ and ‘digital risk’ became stark:

• Gold (XAU): Rocketed over $100 per ounce to hit $5,393, its highest level in over a month. As a ‘no-counterparty-risk’ asset, gold remains the primary flight-to-safety trade.
• WTI crude oil: It surged 6.65%, climbing above $70 per barrel on fears that a blockade of the Strait of Hormuz could paralyze global energy supplies within 25 days.
• Bitcoin (BTC): While BTC briefly rebounded to $68,000 on Sunday, it struggled to maintain momentum once the ‘safe haven’ demand began flowing into gold on Monday.

BTC is currently struggling in its digital gold test in a fundamental way. In 2026, the correlation between BTC and gold turned negative (-0.27), while its correlation with the Nasdaq surged to 0.75.

This suggests that institutional risk models now treat BTC as ‘commodified risk’. When war breaks out, desks sell BTC to cover margin calls in equities and buy gold to hedge against fiat debasement. While BTC’s borderless nature makes it useful for ‘value-at-risk’ during sanctions, its current price action resembles more of a high-beta tech stock.

For the ‘digital gold’ narrative to reclaim its status, BTC has to prove it can decouple from the Nasdaq during these four-to-five week military windows — a feat it has yet to achieve in the 2026 conflict cycle.

Important information: ​​This informational content is written by Crypto.com and should not be considered as an investment recommendation or advice. Trading cryptocurrencies carries risks, such as price volatility and market risks. Before deciding to trade cryptocurrencies, consider your risk appetite.  All forecasting methods, scenarios, and examples are illustrative and subject to market uncertainty. 

Past performance offers context but does not ensure future results. Investment outcomes are subject to market volatility, economic changes, and other unpredictable variables