U.S. President Donald Trump’s recent speech on the Iran conflict sent Bitcoin (BTC) tumbling from $69,000 to below $67,000, erasing gains made in the previous session as markets repriced the odds of a prolonged war.
XWIN Research Japan has released a bearish report that says the sell-off wasn’t just a reaction to headlines; it showed that there are serious problems with the structure of Bitcoin’s derivatives market that could cause prices to drop by as much as 80% in the worst case.
What Trump’s Speech Changed, and Why It Matters for BTC
Markets had been expecting Trump to signal a wind-down of the conflict. Instead, he said the situation would get worse over the next two to three weeks.
Investors responded by selling. The S&P 500 and the Dow both fell, the former closing down 0.23% and the latter 0.39%. Asian markets were also hit, with South Korea’s KOSPI losing 4.2%. Additionally, the price of oil went up 11.41% to $111 a barrel, and the value of the U.S. dollar went up.
According to XWIN, all of that is bad news for Bitcoin, because when oil rises, inflation expectations go up, and when the dollar strengthens, money becomes tighter globally. Both conditions tend to push investors away from risk assets like crypto.
Furthermore, XWIN noted that a widely watched measure of stock market fear, the VIX, climbed to around 25, and stress indicators in the U.S. bond market widened by 27%, pointing to deteriorating liquidity conditions across traditional finance, which historically weigh on BTC just as heavily as on equities.
The analysts identified a specific structural vulnerability at the center of all this: CME Bitcoin futures open interest has reached around 18,000 to 20,000 BTC, which are heavily concentrated in short-dated contracts.
According to them, this means price discovery is being driven more by leveraged positioning than by underlying spot demand, and under stress, those positions won’t roll over; they’ll liquidate and create cascading sell pressure that can amplify price moves well beyond what spot flows alone would justify.
Bitcoin had already been struggling before Trump’s speech, narrowly avoiding closing March in the red for a sixth consecutive month by finishing with a minor 1.8% gain. However, the quarterly picture was bad, with Q1 2026 seeing a 22.2% decline, the worst first-quarter performance since the 2018 bear market.
How Bad Could It Get?
XWIN Research outlined three scenarios, all pointing lower.
The first, and mildest case, could occur if current conditions persist without getting significantly worse, and here, Bitcoin could slide from around $70,000 to $50,000, which would be a drop of 25% to 30%.
Now, if Bitcoin ETFs see sustained outflows and buyers stay on the sidelines, the researchers said the price could fall further to between $20,000 and $30,000, a 60% to 70% decline.
Finally, XWIN says that if the Strait of Hormuz were completely blocked, or if there were a full-blown war in the region, BTC’s price would drop to $10,000, which is about 80% less than current levels.
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