Iran War Sparks Gold, Oil Surge As Crypto Steadies

The war with Iran is here — and markets are reacting with oil surging, gold spiking, and Bitcoin… rallying?

By the middle of Monday’s trading session even the Nasdaq was in the green as President Trump laid out his expectation that fighting could continue for another “four to five weeks.”

Most economic experts are in the same camp that the most important factor now is just how long the conflict lasts. Former PIMCO CEO Mohamed El Erian warned about stagflation risks this afternoon on CNBC, calling out very little wiggle room for the Fed to fight another surge in pricing pressures. At the heart of that issue now sits rising fuel costs.

Oil expert Stephen Schork joined Coinage Monday to weigh in on why oil could continue to rise to $98 after its big 8% move to near $80 a barrel. However, the big spike on Monday eased throughout the session — which could signal the market thinks the war could reach an earlier resolution.

“You have to respect what the market’s saying,” he told Coinage. “This is the market’s way of telling us, okay, there’s not a contagion, there’s nothing metastasizing here that the market is taking a cue that we are going to get a positive, quick (relatively) resolution to the situation.”

In prior Middle East conflicts, markets could at least anchor around a specific objective. This time, he argued, the stated goal of unseating the government in Tehran is far more open-ended. That makes it harder for traders to know whether the current disruption is temporary — or whether it could stretch long enough to push oil meaningfully higher.

And the numbers start to get serious if sentiment shifts.

According to Schork’s modeling, Brent’s second standard deviation band sits just below $80 a barrel. And in a worst-case scenario, if markets decide the Strait of Hormuz could remain effectively closed longer than expected, Brent could push to $98 over the next 20 days.

Prediction Markets Run Into A New Problem

As traders continue to find consensus on war outcomes, prediction markets are already proving quite useful. But that doesn’t mean they haven’t run into their own controversies.

After Iran’s supreme leader was killed, Kalshi refunded a market tied to whether he would be ousted, prompting backlash from users who thought the outcome had clearly resolved. But CEO Tarek Mansour defended the move by drawing a line between broad geopolitical markets and markets tied directly to death, noting that death markets would be illegal.

“We don’t list markets directly tied to death. When there are markets where potential outcomes involve death, we design the rules to prevent people from profiting from death. That is what we did here,” he wrote.

There’s a difference between letting people express a view on macro fallout and building a market that feels uncomfortably close to betting on whether someone lives or dies. The line may not always be clean, but it’s increasingly a real one for regulated U.S. platforms.

Now markets are already moving on to who comes next. The front-runner is one of the 15 grandsons of Ayatollah Khomeini, Hassan Khomeini. Per Reuters, he’s seen as a relative moderate within Iran’s clerical establishment:

He enjoys close ties to reformists including former presidents Mohammed Khatami and Hassan Rouhani, who both pursued policies of engagement with the West when in office. … Khomeini, 53, holds a symbolically important role in public life as custodian of his grandfather’s mausoleum in southern Tehran.

Where the power in Iran swings will surely have major implications for how this all unfolds. As Schork points out, a pro-U.S. resolution could quell market fears quickly.

“And in the longer term, that means more and more investment in infrastructure, both oil and natural gas, and opening up the Iranian oil and natural gas markets to the globe,” he said.

Crypto’s Most Important Telltale Might Be Hyperliquid

If oil was the obvious macro story from the weekend, Hyperliquid may have been the crypto one.

As traders scrambled to price the geopolitical fallout, one of the clearest places that activity showed up was on Hyperliquid — where oil, gold, and other macro exposures increasingly trade in a way that doesn’t care whether Wall Street is open yet.

That helps explain why HYPE continues to stand out. The token is up 23% over the last week. And voting for Hyperliquid to advance in our Crypto Project of the Year series just opened. (We are down to the final four projects — so make sure your voice is heard!)

At this point, Hyperliquid isn’t just a crypto-native perp venue. It’s starting to look like the place traders go when the world breaks on a Saturday and they still want to put risk on immediately.

Then again, as other exchanges play catch up on the 24/7 trend, could Hyperliquid face stiffening competition? As we heard from a few HYPE investors, there’s much more to come.

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