 ▲ United States, Iran, Bitcoin (BTC) / ChatGPT-generated image |
As the threat of full-scale war between the United States and Iran intensifies, a stark warning has emerged from a Wall Street expert that the New York stock market and the cryptocurrency market are on the brink of a massive plunge of up to 35%.
Wall Street strategist Ed Yardeni told cryptocurrency-focused media outlet CoinGape on March 9 (local time) that he is raising the probability of a sharp decline in the U.S. stock market from 20% to 35%. Yardeni analyzed that the U.S. economy is facing the dual challenges of inflationary pressures and slowing growth, while military conflict in the Middle East is rapidly dampening investor sentiment. In particular, as President Donald Trump remains steadfast in his commitment to continue strong strikes against Iran, market uncertainty has reached its peak.
A surge in energy prices is acting as a decisive factor accelerating the downturn in the cryptocurrency market. International oil prices have surpassed $100 per barrel, worsening corporate profitability through rising energy costs and quickly eroding the value of crypto-related stocks. Bitcoin (BTC) mining companies such as Core Scientific have already begun revising survival strategies by selling assets or shifting their business structures toward artificial intelligence. The cryptocurrency market is currently blocked by the massive barriers of an oil price shock and geopolitical risk.
The fading expectation of an interest rate cut by the U.S. Federal Reserve (Fed) is also intensifying market fears. Prior to the outbreak of hostilities, the market had been confident about a rate cut around July, but now prevailing views suggest the cut could be delayed until September or may not occur at all this year. “The U.S. economy and stock market are caught in a dilemma with Iran,” Yardeni said, diagnosing that the Fed has encountered policy limitations as it struggles to balance its dual mandates of price stability and maximum employment.
Iran has reinforced its determination for retaliation by appointing Mojtaba Khamenei, the son of its supreme leader who was killed in a U.S. military strike, as the new leader. As Iranian security officials warn that President Trump will have to pay the price for war, market volatility is expected to intensify further this week. Participants in the cryptocurrency market are reducing exposure to risk assets and moving funds into safer assets in preparation for the possibility of a prolonged conflict.
Amid an unprecedented geopolitical crisis, the cryptocurrency market is undergoing a structural reset phase, declining in tandem with tech stocks. Experts, including Ed Yardeni, agree that if oil prices fail to reverse their upward trend, a 35% crash scenario in both equities and cryptocurrencies could become a reality. Rather than hoping for a short-term rebound, investors are advised to maintain a conservative stance and thoroughly manage risk until macroeconomic headwinds are fully reflected in the market.
Disclaimer: This article is provided for investment reference purposes only, and no responsibility is assumed for investment losses based on it. The content should be interpreted solely for informational purposes.