"Iran war fear erased"...Virtual assets rebound as oil prices fall

▲ Iran, Strait of Hormuz, Bitcoin (BTC)/AI generated image

International oil prices, which had been soaring due to the possibility of an agreement between the United States and Iran, plunged. As a result, risk asset aversion eased, and the previously subdued virtual asset market began to rebound across the board.

According to the US economic media Benzinga on May 25 (local time), the virtual asset market is showing signs of recovery, boosted by signs of easing geopolitical tensions in the Middle East. As news spread in the market that the US and Iran were close to reaching a dramatic peace agreement, the prices of Brent crude and West Texas Intermediate (WTI), benchmarks for international oil prices, both plummeted. With the global inflationary pressure caused by the surge in oil prices and concerns about the US Federal Reserve's hawkish interest rate hikes subsiding, investor capital inflow has resumed.

Bitcoin (BTC), the leader of the virtual asset market, immediately raised its lows and entered an upward trend as geopolitical uncertainties were resolved. Ethereum also settled above key support levels, establishing a psychological defense line for altcoins across the board. Buying sentiment is also expanding in major decentralized finance protocols such as Hyperliquid. In particular, a short-term rotational inflow of funds into privacy financial assets, such as Zcash, which emphasizes security and anonymity, was notable.

Experts in the virtual asset industry diagnosed that this drop in oil prices was a decisive turning point that provided breathing room for risk assets across the board. This is because if the upward pressure on wholesale prices due to soaring oil prices eases, institutional investors who were at a crossroads will find it much easier to execute their funds. However, given the highly volatile nature of geopolitical news, for this rebound to lead to a sustained uptrend, global trading volume must remain stable throughout this week.

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