Escalation of Iran's Internal Power Struggle: Civilian Government vs. Revolutionary Guard
According to a June 30 report by The Wall Street Journal, informed officials reveal that Iran's internal power struggle is seriously threatening U.S.-Iran peace negotiations. President Pezeshkian's civilian leadership seeks to unfreeze billions of dollars in overseas assets to alleviate the severe economic hardships faced by millions of Iranians. In contrast, the Islamic Revolutionary Guard Corps (IRGC), now dominant in Iran, insists on maintaining complete control over the Strait of Hormuz at all costs. They plan to establish a lucrative toll mechanism that would both enrich the armed forces and dominate regional security dynamics.
Strait of Hormuz Blockade Risk: Direct Impact on Global Oil Supply
The IRGC has informed mediators that if the Doha negotiations fail to provide guarantees for Iran's exclusive control over the Strait of Hormuz, they will close the waterway again. The organization also demands that the U.S. and other countries abandon plans to allow ships to use the southern waters near Oman. The Strait of Hormuz is the world's most vital oil transit chokepoint, carrying roughly 20 million barrels of crude oil and refined products daily. A blockade could trigger a sharp spike in oil prices, disrupting the global economy and fueling inflation.
Potential Transmission Channels to the Crypto Market
Geopolitical risks typically affect the crypto market through two main channels:
- Macro risk-off sentiment: Soaring oil prices → elevated inflation expectations → the Fed may keep rates high or delay cuts → risk assets (including Bitcoin) come under pressure. During the 2022 Russia-Ukraine conflict, Bitcoin fell from around $45,000 to $35,000, reflecting short-term geopolitical selling.
- Liquidity tightening: Higher energy costs may weaken economic recovery, prompting capital to flow toward traditional safe-havens like the U.S. dollar and gold, putting crypto under capital outflow pressure.
However, over the long term, geopolitical uncertainty could also drive some investors toward decentralized assets, especially in jurisdictions with favorable regulations. But in the near term, market focus remains on whether the Strait of Hormuz situation leads to actual energy supply disruption. A notable historical case: after the U.S. airstrike that killed Qasem Soleimani in January 2020, Bitcoin experienced a brief flash crash but quickly rebounded, showing the market's efficiency in pricing geopolitical events.