Crypto Market

BTC and ETH Market Insight

The week was characterized by volatile consolidation with relatively stable flows, despite highly controversial geopolitical events. Bitcoin (BTC) staged a sharp mid-week bounce to nearly $70,000 before fading to hover around $65,000. It either continued moving downward or struggled to break further resistance levels.

Trading volume remained in the $40–50 billion range per day. Bitcoin ETF inflows finally ended a five-day streak of redemptions, thanks to MicroStrategy’s continued acquisition of BTC, pushing its total holdings to 717,722 BTC.

Sentiment has been mildly more positive, with the Fear & Greed Index rising to 15 from a previous level of 10. However, it remains firmly in extreme fear territory. Ethereum is sitting at a major support zone amid controversy surrounding Vitalik Buterin selling his holdings. Reports indicate that over 17,000 ETH (roughly $35 million) were sold in February, with the proceeds intended to support the network’s development. Similar amounts were pledged to fund privacy and security projects on-chain.

Geopolitical conflicts and their further developments remain a must-watch for both traders and investors. Tensions were already elevated throughout the week and escalated dramatically over the weekend following a joint US-Israel strike that killed Iran’s Supreme Leader Ayatollah Ali Khamenei and multiple top officials. Iran retaliated with ballistic missiles and drone swarms targeting U.S. bases (e.g., Kuwait), Israel, and other Gulf targets. As of today, the conflict is expected to last at least four weeks or more, as President Trump has stated that operations will continue until all objectives are achieved.

Oil prices spiked sharply due to risks surrounding the Strait of Hormuz, which handles around 20% of global oil supply. Equity markets and high-beta assets turned risk-off, while safe-haven assets rallied. BTC and crypto initially dumped to $63,000 but partially recovered to the $65,000–$68,000 range as uncertainties eased and some haven buying emerged.

In the medium term, sentiment is mixed but potentially supportive. Higher oil prices could increase the likelihood of stagflation, which may prompt the Fed to implement rate cuts earlier than expected. This could help stimulate the market and allow high-beta assets (crypto) to rally following a least ideal start to 2026.

Upcoming Macro Calendar - Source: Trading Economics

Options Market

Despite a modest price rebound for BTC and ETH during the week, the crypto market navigated fragile sentiment amid a massive $8.72 billion Deribit expiry on February 27—$7.74 billion for BTC and $975 million for ETH—where put-call dynamics signaled persistent downside hedging. After weak trading sessions on Friday and Saturday, the market quickly surrendered gains, ending the week largely flat. Front-end implied volatility spiked on the dip in tandem with realized volatility, reaching 60% for BTC's 1-week ATM IV and 79% for ETH's. Skew remained bearish with elevated put premiums, underscoring ongoing defensive hedging. Despite the fragile sentiment, ETF netflows reversed to positive for the first time in February, netting +$560 million for BTC and +$117 million for ETH weekly.

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Macro

The Iranian state media has confirmed that Iran’s supreme leader Ali Khamenei was killed in U.S-Israeli strikes. The U.S. President Donald Trump has indicated that the waves of strikes could continue through the week. The crude oil price jumped over 10% on Sunday, mainly due to the closing of Strait of Hormuz. The conflict might continue to bring uncertainty to the risky assets across the global market.