Amid Geopolitical Conflict: Stablecoin Supply Rises, Crypto Market Strengthens Against the Trend

According to market observations released by QCP Capital, despite the escalating conflicts in the Middle East, #Bitcoin and Ethereum have risen against the trend, breaking through $74,000 and $2,270 respectively, while US stocks and gold remain under pressure during the same period.

If this divergence trend continues, it will break the long-standing inertial characteristic of crypto assets "falling with the market but not rising with it," potentially becoming an important turning point by the end of this quarter.

From recent price trends, Bitcoin's narrative as a "digital safe haven" or "geopolitical hedging tool" is making a comeback, and the crypto market is undergoing a real-time test of this thesis.

As tensions surrounding Iran escalate, more users are turning to on-chain solutions for cross-border liquidity and capital flow channels, pushing USDC supply to an all-time high of $81.1 billion last week.

This growth in supply not only drove the expansion of the overall stablecoin market size but also reflects that amid accelerating global uncertainty, new capital is rapidly flowing into the crypto market.

Looking back at history, crypto assets are not experiencing decoupling and appreciation relative to US stocks and gold for the first time. In the early stages of the 2022 Russia-Ukraine conflict, Bitcoin rebounded 37% from $35,000 to $48,000 within a month, only to reverse due to the Terra/Luna and FTX collapse.

Today, the industry has matured significantly. With the potential passage of the "CLARITY Act," similar market recoveries may repeat, but this time they may not be accompanied by the same systemic shocks.

Michael Saylor also appears to be betting on this bullish outlook, with his company's Strategy taking advantage of the strong momentum of preferred stock STRC to continuously increase Bitcoin holdings.

Meanwhile, institutional liquidity is currently showing signs of returning flows. As of last Friday, Bitcoin ETFs have achieved net inflows for 5 consecutive days, with BlackRock's ETF recording net inflows for 3 consecutive weeks, attracting a total of over $1.75 billion.

In the options market, BTC spot is approaching the largest open interest strike price at month-end (BTC-27MAR26-75K-C). Once it breaks through the $75,000 strike price, it could trigger a short squeeze and amplify the upside.

Market performance over the next few trading days will determine whether the crypto market can sustain its strong rebound or return to range-bound oscillations and close out the first quarter smoothly—currently awaiting observation.