INDODAX Values the Relaxation of US-Iran Tensions to Boost the Recovery of Crypto Market Sentiment

JAKARTA - Global market sentiment has improved again after the United States (US) and Iran reached an initial agreement to end the conflict and reopen the Strait of Hormuz. The easing of geopolitical uncertainty encourages investors to return to high-volatility assets, including crypto assets, so that the price of Bitcoin broke through the level of 65,900 US dollars on Monday, June 15.

Based on data from CoinMarketCap on Monday, Bitcoin was trading in the range of US$63,900 to US$65,900, or up around 2 percent in the last 24 hours. The strengthening also put Bitcoin almost 8 percent above last week's low which was below US$60,900.

Chief Marketing Officer of INDODAX, Aloysia Dian, revealed that the easing of geopolitical tensions in the Middle East provides room for investors to increase their exposure to assets with high volatility characteristics after several weeks of market overshadowed by cautious sentiments.

"The current crypto market is responding to the improvement of global sentiment after geopolitical uncertainties have begun to ease. When global risks decline, investors tend to increase their exposure to high-volatility assets, including Bitcoin and other crypto assets. This is currently also driving a price recovery in the market," said Aloysia.

Not only Bitcoin, the majority of major crypto assets also recorded strengthening. Ethereum rose around 5.1 percent to the level of 1,758 US dollars, Solana strengthened 6.6 percent to 72.6 US dollars, while XRP added 7.1 percent to 1.2 US dollars. Among the large-cap crypto assets, Hyperliquid (HYPE) became one of the assets with the highest increase after strengthening around 11.6 percent to the level of 67.8 US dollars.

The strengthening of the crypto market occurs along with the improvement of global risk sentiment. After the US-Iran deal was announced, Brent crude prices corrected by more than 4 percent to around US$83 per barrel as markets began to reduce the geopolitical risk premium that had previously weighed on global economic prospects. At the same time, Asian stock markets strengthened, US stock index futures contracts moved positively, and pressure on the US dollar began to ease.

Amid the improving market sentiment, Aloysia reminded that the sustainability of this positive trend still depends on factors that will determine whether the strengthening of Bitcoin can continue in the near future.

"The easing of geopolitical tensions is certainly a positive development for the market. However, investors still need to pay attention to various other factors, including institutional fund flows through spot Bitcoin ETFs, regulatory developments, global monetary policy, investor interest, and global liquidity conditions. Therefore, we see it is important for investors to continue to pay attention to market developments in a comprehensive manner and not only focus on a certain sentiment," said Aloysia.

One of the indicators that will be of concern to the market is the movement or flow of funds on the Bitcoin Spot ETF in the United States. In the past week, the instrument recorded an outflow of 1.72 billion US dollars which shows that some institutional investors are still cautious about assets with volatile characteristics.

In addition to geopolitical sentiments, the market is also still looking at a number of fundamental factors that have the potential to affect the direction of Bitcoin's movement in the near future. One of them is the interest of institutional investors as reflected by the flow of funds in the Bitcoin Spot ETF in the United States.

As a regulated crypto exchange in Indonesia, INDODAX continues to remind the public to apply the principle of wise investment, conduct independent research (DYOR), conduct Dollar Cost Averaging (DCA) through the regular investment feature on INDODAX to help manage risks amid market volatility.