This Crisis Will First Crash Crypto — Then Ignite the Biggest Boom Ever
James Allan4 min read·Just now--
In the weekend of March 1st, 2026, President Trump made the decision to attack Iran in what he described as a pre-emptive strike to protect the United States. Since this article focuses on crypto rather than politics, we will not concern ourselves with whether the justification for this action is sound or misguided. Instead, we will examine the potential consequences this decision may have on global financial markets — and particularly on crypto.
My suspicion is that a war with Iran will not remain contained. It will expand into a much larger geopolitical conflict, drawing in multiple powers and eventually turn into a World War. When investors begin to grasp the scale and likely duration of such a conflict, the world will experience a severe liquidity shock capable of disrupting the global financial system.
In such an environment, investors historically begin selling risk assets in order to raise cash. Fears of sovereign debt stress, currency instability, and trade disruptions could trigger widespread liquidation across markets.
Governments facing the enormous costs of mobilization, will likely issue massive quantities of war bonds to finance military operations. This sudden increase in debt issuance would place heavy downward pressure on existing treasuries, raising the possibility of a major bond market crash reminiscent of past wartime financial panics.
Precious metals will likely surge as central banks lose confidence in foreign currencies and increasingly settle trade in gold. At the same time, cryptocurrencies could experience a sharp and immediate drawdown as liquidity from ETFs and traditional financial markets dries up.
In short, the early phase of such a conflict would likely produce a global financial shock — one marked by extreme volatility, rapid deleveraging, and a scramble for liquidity across markets. The effective result is a global liquidity crisis triggered by geopolitics.
After the crypto market has been devastated by such a crash, a period of stagnation will likely follow as markets struggle to stabilize. This lull could last months, or even several years. But eventually, another force will reignite the crypto markets — the global currency crisis.
The U.S. dollar has lost roughly 97% of its purchasing power since 1912. A global war could destroy the remaining 3%. The trigger would likely be a major U.S. military defeat somewhere in the world.
American forces are currently operating across several theaters, making it difficult to predict which front might inflict this defeat. But once it happens, the large number of U.S. protectorates that currently prop up the dollar will begin to jump ship — causing the dollar to free fall into oblivion.
On the home front, Americans will feel this free fall most acutely in energy and food prices. The cost of basic necessities will begin rising so rapidly that people will lose confidence in the dollar. This is especially true for merchants, whose margins can be wiped out overnight by sudden price swings in the goods they sell. Faced with that reality, people will begin to abandon the dollar and turn to an alternative currency — crypto.
This period of disturbance and chaos is precisely when the winning cryptocurrency will emerge. As people flee the collapsing dollar, crypto markets will surge. But the real transformation will go beyond price. For the first time, people will begin using cryptocurrency in everyday commerce. What was once a niche technology will be forced into the mainstream by necessity.
The question you may now be asking is this — which cryptocurrency will emerge as the winner from all of this?
Although I cannot name a specific crypto, I can say with certainty that it will be the one best positioned to take advantage of this wave of mainstream consumer demand. It must have the network capacity to handle massive transaction volume, and it must possess the entrepreneurial and developer ecosystem needed to build the infrastructure that bridges crypto to the public.
The real wildcard is the winner might actually be something not dominant today. History shows that crisis adoption often elevates the system that simply works best under pressure.
As for my honest engineering view, if the scenario I described were to unfold, the likely winners would be Bitcoin, Ethereum, and Kaspa. Bitcoin as the global reserve crypto, Ethereum as the financial infrastructure, and Kaspa as the network for high-speed payments.
Which crypto will ultimately win… only God knows. But one thing is certain — you cannot possess the treasures of this world without rolling the dice.
