Dynamics Supporting BTC and HYPE During the Iran Conflict
BTC has outperformed traditional asset classes since the start of the US-Iran conflict. BTC has managed to hang in around the $70K level, while HYPE has climbed to its highest levels in months, amongst the best performers of large cap tokens.
MSTR Purchases Supporting BTC
While market sentiment remains fearful (CMC Fear & Greed Index readings of 20-40), with some investors still on the sidelines on the crypto rally, key flows into BTC have come from Strategy (MSTR). Per its SEC filings, March 2026 MTD BTC purchases (from Mar 2 onward) totaled $2.9B as of Mar 23.
MSTR’s total BTC holdings is now 762K and compares to 786K for IBIT (as of March 25, 2026), a gap it continues to close despite softer market conditions. Key to its recent traction in purchases has been issuance through its STRC preferred stock. At the start of the month, MSTR increased the STRC dividend rate by 25 bps to 11.5%, which proved meaningful enough to drive demand from investors. This has enabled it to raise around $1.6B through this instrument in March so far, potentially helping power as much as 50% of its total BTC purchases in the month. This compares to $78M of STRC issuance in February, suggesting the stepped-up dividend rate may have had a key role to play in driving investor interest.
At the same time, at-the-market (ATM) issuance of its common stock remains a significant lever, driving the remaining $1.3B of BTC purchases in the month. It demonstrates that despite broad compression in DAT mNAV premiums in the past few months, MSTR is still seen as a key vehicle for BTC exposure, allowing it to raise funds opportunistically.
On March 23, 2026, Strategy announced a new $21B STRC ATM program and a new $21B MSTR ATM program. This is a massive upsize of its previous $4.2B STRC ATM program from July 2025 and indicates it expects to lean further on STRC to drive BTC purchases in the future.
One potential drawback with relying more on STRC is that it could cause MSTR’s obligations to climb significantly, therefore raising sustainability concerns. Issuing the full $21B under STRC could cause an incremental $2.4B of annual dividend obligations at the current 11.5% rate, which compares to its $2.2B+ USD dividend reserve (as of Feb 1, 2026). In such a scenario, MSTR could look to use common stock ATM proceeds to cover the dividends.
BTC ETFs Inflows See Positive Streak
BTC ETF net flows have totaled $1.5B MTD as of March 25, 2026, notching 4+ consecutive weeks of inflows, a streak not seen since September 2025. Given CME basis remains low with the next month contract trading around 5% annualized, per data from Velo, ETF inflows may be originating from slow money, rather than funds putting on cash and carry trades, suggesting BTC's strength could be sustainable.
Seller exhaustion may also be a factor playing into crypto’s strength. Following the substantial selloffs in Oct 2025 and Feb 2026, it is possible most sellers were already out of the market, with several oversold indicators flashing in February that have historically occurred around market bottoms. Moreover, with the recent drops across equities and metals, but not crypto, it seems that derisking has been taking place in the assets that have not sold off yet. This is implied by a decline in BTC’s 30D correlation with gold in March.
The BTC strength vs metals may also be technical in nature. The BTC/SILVER ratio bounced after hitting multi-year lows of around 700, which marked the prior bottom for the pair in December 2022. A lull in metals may be a key condition for BTC to further regain its footing as traders that flocked to participate in the gold and silver rallies may come back to trading crypto.
Traders Flock to Hyperliquid
The Iran conflict appears to be driving record activity on Hyperliquid’s HIP-3 markets, where volumes have shifted from markets on metals to those on oil as developments unfold. Hyperliquid is one of the few major venues where traders can express views when traditional markets are closed on the weekends, and seems to have benefited from increased awareness around its offerings. This can help explain HYPE’s relative strength, up nearly 25% MTD as of March 25, per data from Artemis.
This is turning up in the data, with HIP-3 open interest climbing to $1.6B (23% of total Hyperliquid OI) and comprising 46% of total Hyperliquid daily volumes, as of March 23, 2026, per data from ASXN. Daily unique traders have increased from around 29K at the end of February to over 43K as of March 25,, 2026.
HIP-3 market deployer trade[XYZ] announced last week it was launching the first official S&P 500 perpetual contract in partnership with S&P Dow Jones Indices. While the S&P 500 is licensed for use across many financial products, this deal stands out as the first of its kind on-chain and further solidifies Hyperliquid as a key venue in the convergence of traditional finance and crypto.
Meanwhile, Hyperliquid may have further tailwinds from new features in its pipeline. Portfolio margin is now in alpha, and HIP-4 outcome markets are live on testnet. Such features further support its ‘House of All Finance’ narrative and position Hyperliquid directly in competition with prediction markets, which are building out their own markets on 5 or 15-min crypto price swings.
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"FalconX" is a marketing name for FalconX Limited and its affiliates. Availability of products and services is subject to jurisdictional limitations and capabilities of each FalconX entity. For information about which legal entities offer trading products and services, or if you are considering entering into a derivatives transaction, please reach out to your Sales or Trading representative.
This material is for informational purposes only and is only intended for sophisticated or institutional investors. Neither FalconX Limited, FalconX Bravo, Inc., FalconX Delta, Inc., FalconX Foxtrot Pte Ltd., FalconX Golf Pte Ltd., Solios, Inc., Falcon Labs, Ltd., KestrelX, Ltd., nor Banzai Pipeline Limited (separately and collectively “FalconX”) service retail counterparties, and the information on this website is NOT intended for retail investors. The material published on this website is not (i) an offer, or solicitation of an offer, to invest in, or to buy or sell, any interests or shares, or to participate in any investment or trading strategy, (ii) intended to provide accounting, legal, or tax advice, or investment recommendations, or (iii) an official statement of FalconX or any of its affiliates. Any information contained in this website is not and should not be regarded as investment research, debt research, or derivatives research for the purposes of the rules of the CFTC or any other relevant regulatory body.
Prior to entering into any proposed transaction, recipients should determine, in consultation with their own investment, legal, tax, regulatory, and accounting advisors, the economic risks and merits, as well as the legal, tax, regulatory and accounting characteristics and consequences of the transaction. Pursuant to the Dodd-Frank Act, over-the-counter derivatives are only permitted to be traded by "eligible contract participants" (“ECP”s) as defined under Section 1a(18) of the CEA (7 U.S.C. § 1a(18)). Do not consider derivatives or structured products unless you are an ECP and fully understand and are willing to assume the risks.
Solios, Inc. and FalconX Delta, Inc. are registered as federal money services businesses with FinCEN. FalconX Bravo, Inc. is registered with the U.S. Commodities Futures Trading Commission (CFTC) as a swap dealer and a member of the National Futures Association. FalconX Limited, FalconX Bravo, Inc., FalconX Delta, Inc., Falcon Labs Ltd., and Solios, Inc. are not registered with the Securities & Exchange Commission or the Financial Industry Regulatory Authority. FalconX Golf Pte. Ltd. is not required to be registered or licensed by the Monetary Authority of Singapore (MAS). MAS has granted FalconX Foxtrot Pte. Ltd. a temporary exemption from holding a license under the PSA for the payment services caught under the expanded scope of regulated activities for a specified period. FalconX Limited is a registered Class 3 VFA service provider with the Malta Financial Services Authority under the Virtual Financial Assets Act of 2018. FalconX Limited is licensed to provide the following services to Experienced Investors, Execution of orders on behalf of other persons, Custodian or Nominee Services, and Dealing on own account. FalconX’s complaint policy can be accessed by sending a request to complaints@falconx.io
"FalconX" is a marketing name for FalconX Limited and its affiliates. Availability of products and services is subject to jurisdictional limitations and capabilities of each FalconX entity. For information about which legal entities offer trading products and services, or if you are considering entering into a derivatives transaction, please reach out to your Sales or Trading representative.
