Bitcoin could be the big winner if the U.S.-Iran conflict drags on for months

Markets Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Bitcoin could be the big winner if the U.S.-Iran conflict drags on for months Macro strategist Mark Connors says war-driven spending, rising debt and lower interest rates could support bitcoin. By Helene Braun | Edited by Sheldon Reback Mar 9, 2026, 4:07 p.m. Make us preferred on Google (Noam Galai/Getty Images) What to know : Macro strategist Mark Connors said a prolonged U.S.-Iran conflict could boost bitcoin as war-related deficit spending expands liquidity and weakens the dollar. Rapid U.S. debt growth and potential currency debasement are likely to push investors toward alternative assets such as bitcoin, Connors said. The Federal Reserve’s need to keep Treasury markets functioning, combined with government borrowing, may lead to the lower interest rates and looser liquidity conditions that historically support bitcoin. Bitcoin BTC $ 68,802.94 may gain if a potential U.S.-Iran conflict stretches on for months as higher government spending, rising debt and lower interest rates create conditions that have historically supported the cryptocurrency, according to macrostrategist Mark Connors. Wars are expensive, and financing them typically requires governments to issue more debt, said Connors, formerly the head of research at 3iQ and global head of portfolio and risk advisory at Credit Suisse. That increases the supply of dollars in the financial system, lowering — or debasing — the value of the existing circulation, and tending to benefit non-dollar assets like bitcoin. “Liquidity drives bitcoin,” said Connors, who now has his own bitcoin advisory firm called Risk Dimensions, in an interview with CoinDesk. If the conflict extends into the next several months, he expects deficit spending to accelerate as the U.S. finances military operations. “If the war runs longer, that means more spending and more deficit spending. That’s constructive for bitcoin.” The U.S. debt load has already been growing rapidly. Connors said federal debt has been rising at roughly a 14% annualized pace since mid-2025. If the trend continues, the debt could increase about 15% year-over-year. “That’s debasement,” he said. Bitcoin appeared to reflect some of that dynamic on Monday. The cryptocurrency rallied overnight and into the U.S. morning as investors pulled money out of equities and repositioned portfolios for the possibility of a prolonged conflict. Since the first U.S. strike on Iran, bitcoin has gained 3.6%. A war-driven surge in oil prices could complicate the outlook by pushing inflation higher, Connors said. But he argued that even a stagflationary environment — where growth slows while prices rise — could support bitcoin. In that scenario, policymakers would likely prioritize financial stability and government financing over fighting inflation alone. Connors said the Federal Reserve effectively operates under an additional mandate beyond its traditional goals of stable prices and maximum employment: maintaining the smooth functioning of financial markets, particularly the Treasury market. Authorities cannot allow disruptions like the 2019 repo market crisis or the regional bank failures seen in 2023 after aggressive rate hikes, he said. “The Fed has to make sure the Treasury market functions,” Connors said. That constraint may push policymakers toward lower interest rates over time, especially as the government shifts toward issuing more short-term Treasury bills rather than long-term bonds. Lower rates are also more likely if Kevin Walsh — picked by President Trump partly for his dovish stance — becomes chair of the Fed in May, pending confirmation by the Senate. With a larger share of debt rolling over quickly, lowering short-term rates would directly reduce the government’s interest costs. If rates fall while deficits continue to expand, liquidity conditions would likely improve — a combination Connors believes would favor bitcoin. “When rates go lower and debt keeps rising, that’s the backdrop where bitcoin tends to perform well,” he said. Bitcoin News US war More For You Pudgy Penguins: Challenging the Pokemon and Disney Legacy in the Global IP Race By CoinDesk Research Feb 27, 2026 Commissioned by Pudgy Penguins CoinDesk Research looks into how Pudgy Penguins disrupts traditional toys market via a phygital model. With 2M+ units sold, they scale via global partnerships and events. What to know : Disrupting a Stagnant Market : Pudgy Penguins is utilizing a "Negative CAC" model to challenge the traditional $31.7B licensed toy industry by treating physical merchandise as a profitable user acquisition tool rather than just a final product. View Full Report More For You Bitcoin rises to $69,000, stocks reverse big early losses, as crude oil sinks back below $100 By Helene Braun , Krisztian Sandor | Edited by Stephen Alpher 12 minutes ago WTI crude oil, which soared nearly 30% to $120 per barrel overnight, has pulled back to $95, easing pressure on risk assets. What to know : Crypto prices were higher across the board in midday U.S. trading on Monday. Falling to just above $65,000 overnight, bitcoin rallied back to m$69,000 as crude oil fell from $120 per barrel to $95. Circle saw the biggest gains among crypto-related stocks, up 8% on the day after global insurance giant Aon said it paid insurance premiums in stablecoins for the first time. 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