This weekend, the conflict between Saudi Arabia and the Houthi forces escalated, and Trump repeatedly hinted at further actions against Iran.
According to the traditional script, at times like this, funds should be fleeing risk assets wildly, rushing into the dollar, gold, and U.S. Treasuries.
But on Monday morning, Bitcoin accelerated its rebound, once again challenging $87,000, temporarily at $86,671, with a 24-hour increase of 1.35%.
War is escalating, crypto assets are rising.
$350 billion.
This is the annual blockchain transaction volume in the Middle East and North Africa region. In 2022, this figure was $100 billion. It has more than tripled in three years.
The Bitcoin Policy Institute's September 4 report: "How Conflict is Reshaping Digital Asset Usage in the Middle East." The core conclusion in one sentence—
"Regional conflicts usually accelerate capital outflows. But the Iran conflict shows a different dynamic: capital has not left the region but is increasingly turning to digital assets."
In plain language: the money hasn't fled. The money has changed tracks.
The traditional script says: War → Capital flight → Dollar/Gold benefit.
This time: War → Capital stayed on-chain.
Gulf countries are proactively setting the stage to attract institutional funds.
What are the UAE and Bahrain doing? They are not banning crypto but building regulatory frameworks, issuing licenses, and competing for institutions.
In May this year, Kraken's parent company Payward obtained preliminary authorization from the Dubai Virtual Asset Regulatory Authority to conduct brokerage trading and investment management business.
On one side, currency devaluation is pushing ordinary people onto the blockchain; on the other, regulatory frameworks are inviting institutions in. Two paths, same direction.
When Israel and Iran went to war in June 2025, Bitcoin's initial reaction was to fall along with stocks. It showed no "digital gold" safe-haven properties. Investors first reduced positions to hedge, with Bitcoin bottoming at $63,000.
But what happened next is key—
Investors began shifting from higher-risk altcoins into Bitcoin, pushing Bitcoin's market share in crypto to a one-month high of 64.8%. The price stabilized amid ongoing conflict.
What does this mean?
At the most panicked moments, the market chose Bitcoin, not gold, not U.S. cash.
Of course, Bitcoin's first reaction was to fall with risk assets, which must be honestly acknowledged—it was not yet a "safe-haven asset" then. But as the conflict continued, the choice of capital changed.
Data from early October confirms this trend:
On October 1, Bitcoin spot ETFs had a total net inflow of $103 million, BlackRock's IBIT had a single-day net inflow of $196 million, with a historical total net inflow reaching $65.574 billion.
On October 5, the SEC approved Cboe BZX Exchange's rule change allowing Volatility Shares to issue 3x Bitcoin futures ETFs and five other leveraged products.
The Crypto Fear & Greed Index dropped from 74 on October 1 to 67 on October 3, still in a "greedy" state.
ETFs are accumulating, leveraged products are being approved, sentiment is greedy.
In the traditional narrative framework, Middle East turmoil = oil price rise = inflation pressure = Fed afraid to cut rates = risk assets under pressure.
This logical chain was broken in 2026.
The reason is that on-chain transactions operate around the clock. When traditional markets are closed, crypto markets keep running. The more turbulent the situation, the more obvious this advantage becomes.
War comes, banks close, exchanges halt. But your Bitcoin wallet is always online.
Everyone is discussing whether the Fed will raise rates, whether JPMorgan will turn cautious, what Wash said on Friday.
But Middle Eastern capital has already given the answer.
While oil tankers in the Strait of Hormuz are burning, Middle Eastern capital is seeking safe harbor on-chain.
This is the most underestimated narrative behind this round of BTC's rise.
$BTC$BZ#BTC现货ETF重回流入，ETH资金持续流出$XAU
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