The crypto market has held steady in the past few days, even as the war in the Middle East started. Bitcoin price rose to $70,000 on Monday and then pulled back to $68,500. Ethereum remains above $2,000, while XRP and Solana rose by over 2% in the last 24 hours.
Crypto Market Rallies Despite War in the Middle East
The market capitalization of all coins rose by over 2.4% in the last 24 hours to over $2.34 trillion. Some of the top gainers on Tuesday included Near Protocol, Morpho, Ethena, and Aave, which each rose by over 8%.
On the other hand, Polkadot, Polygon, Shiba Inu, and World Liberty Financial (WLFI) were the top laggards, falling by more than 3% during the same period.
The crypto market mirrored the stock market’s performance. Top indices like the Dow Jones, S&P 500, and Nasdaq 100 initially fell when the market opened on Monday and then pared back those losses.
The crypto market is going up despite the ongoing fierce fighting in the Middle East because the war was already priced in. Most people expected it to happen, as evidenced by the rising odds on Polymarket and Kalshi.
Therefore, cryptocurrency prices are doing well as investors consider a ceasefire, which may happen in the next few days or weeks. A Polymarket poll shows that the odds of a ceasefire happening by the end of March rose to 46%.
READ MORE: Could a Trump Strike on Iran Trigger a Crypto Market Rally and Recovery?
One major possibility is that Donald Trump pulls back from the war, arguing that he has achieved his goal of eliminating Iranian leadership and its weapons production programs. The rising odds of a ceasefire also explain why crude oil prices have not risen above $100 as some analysts expected.
READ MORE: XRP Price Prediction: Top Reasons Ripple May Rebound in March
Futures Open Interest Rose as Liquidations Dropped
The crypto market is rising as futures open interest rebounds, a sign that investors are starting to embrace leverage in their trading. Data compiled by CoinGlass shows that the 24-hour futures open interest rose 4.4% to over $98 billion, while liquidations fell 5.2% to over $334 million. Funding rates dropped to near zero.
Additionally, some analysts believe the Federal Reserve may cut interest rates if the war in the Middle East leads to slower economic growth in the country. Still, an extended war may lead to higher inflation, making it hard for the bank to cut interest rates.
The crypto market also held steady after the US published strong macro data on Monday. Separate reports from S&P Global and the Institute for Supply Management (ISM) showed that the manufacturing sector continued to grow in February.
The next major catalyst from a macro perspective will be the ADP private sector report on Wednesday, followed by the Bureau of Labor Statistics’ (BLS) non-farm payrolls (NFP) that will come out on Friday.
READ MORE: Ethereum Price Prediction for March: Will ETH Crash Further or Rebound?
