Firi Weekly: Geopolitical Uncertainty

Geopolitics Drive Market Volatility:
- Rising U.S.–Iran tensions triggered market uncertainty, as President Donald Trump issued an ultimatum to Iran that was later postponed. This has contributed to volatility across equities and crypto, with the S&P 500 down 4.14% and Nasdaq-100 down 5.3% year-to-date.
SEC Clarifies Crypto Is Not Securities:
- The U.S. Securities and Exchange Commission (SEC) confirmed last week that most cryptocurrencies are commodities, not securities, reducing regulatory risk. At the same time, clearer rules for staking and mining were introduced, and there are plans to make it easier to launch startups without prior registration with the SEC.
Stripe Launches the Tempo Blockchain:
- Payment company Stripe, together with partners including Visa and Deutsche Bank, launched the Tempo blockchain after a $500 million raise in 2024. It focuses on fast, low-cost stablecoin payments, but there are still concerns that the blockchain is centralized.
BlockFills Bankruptcy Signals Isolated Risk:
- U.S. institutional crypto lender BlockFills filed for bankruptcy last week, reporting $50–100 million in assets against $100–500 million in liabilities. It suggests that the case reflects an isolated incident rather than a broad systemic risk, as the industry has become significantly more mature in recent years.

Last Week’s Big Three

The U.S. SEC Publishes Positive Crypto Guidelines: The U.S. Securities and Exchange Commission (SEC) released long-awaited guidance last Tuesday clarifying which cryptocurrencies should be considered securities. A security is a financial instrument in which investors provide capital with an expectation of profit derived from the efforts of others and is generally subject to stricter regulation than commodities. For years, the crypto industry has pushed back against broad classification under securities law.

In guidelines issued last week, the SEC stated that most cryptocurrencies are not securities but commodities, which is a constructive development. It also clarified how securities laws apply to mining, staking, and airdrops. In addition, the SEC plans to introduce a program that would allow startups to launch crypto-related businesses, investment contracts, and security tokens without prior registration. The clarity itself is significant, as the industry has long operated under regulatory uncertainty.

Stripe’s Blockchain Temp Launches: Payment company Stripe, in collaboration with the crypto venture firm Paradigm, officially launched the Tempo blockchain last Wednesday. The project was first announced in September and raised $500 million in October last year. Tempo is designed specifically for stablecoin transfers, aiming to deliver fast and low-cost digital payments.

The launch includes a strong set of partners such as Anthropic, Deutsche Bank, OpenAI, Visa, UBS, Mastercard, and Shopify. Despite this, the crypto community has been largely skeptical. The main concern is that Tempo is not decentralized, particularly at launch. Critics question why a new standalone blockchain is necessary instead of building on established networks like Ethereum or Solana, as additional chains can fragment the ecosystem.

Historically, centralized or semi-centralized blockchains have struggled to gain traction due to limited network effects across users, developers, and enterprises. That said, Stripe and its partners bring significant distribution across payments, enterprise software, and AI. If any group can successfully start a new network from scratch, this consortium is well positioned to do so.

U.S. Crypto Broker and Lender Files for Bankruptcy: U.S.-based crypto trading and lending platform BlockFills filed for bankruptcy last week. The firm primarily served institutional clients and is relatively small. It had already halted deposits and withdrawals in February. In its filing, BlockFills reported assets between $50 million and $100 million, against liabilities of $100 million to $500 million.

For long-time market participants, this recalls the wave of failures in 2022, when several crypto lending platforms collapsed. However, such events have become much less common as the industry has matured and now operates under more robust regulatory oversight, making this arguably an isolated event.

Behind the Charts

Chart 1: S&P 500 and Nasdaq-100, Year-to-Date Performance

Last week was volatile, with major crypto assets such as Bitcoin and Ethereum reaching their highest levels in roughly six weeks before reversing mid-week, as noted in our previous Firi Weekly.

The pullback appears linked to escalating tensions in the Middle East, involving the U.S. and Israel on one side and Iran on the other. This has also weighed on equities, with both the S&P 500 and Nasdaq-100 declining over the week. Year-to-date, the S&P 500 is down 4.14% and the Nasdaq-100 is down 5.3%, and these declines have arguably also put stress on the crypto market.

Over the weekend, tensions in the Middle East escalated after President Trump gave Iran 48 hours to reopen the Strait of Hormuz or face U.S. strikes on key energy infrastructure. Markets reacted negatively to the potential escalation. On Monday, however, Trump extended the deadline by five days, citing progress toward a possible agreement. Iran largely denied that any meaningful progress had been made.

Chart 2: Bitcoin and Ethereum Exchange Balances

A more positive trend is the continued decline in exchange balances for both Bitcoin and Ethereum. Year-to-date, Bitcoin balances on exchanges have fallen by approximately 58,700 bitcoins, equivalent to around $4.2 billion. Ethereum balances have declined by roughly 1,77 million Ether, valued at about $3.86 billion.

This trend is typically seen as positive, as it suggests fewer assets are readily available for sale, as it indicates that investors are moving holdings off exchanges into longer-term storage.

A Number to Remember

3.50% to 3.75% interest rate

The U.S. Federal Reserve kept its policy rate unchanged at 3.50% to 3.75% last Wednesday, in line with market expectations. As the decision was widely expected, it only had a slightly negative impact on crypto markets.

More broadly, lower interest rates are generally positive for digital assets. As interest rates decline and returns on cash and low-risk instruments fall, investors are more inclined to allocate capital toward higher-risk assets such as cryptocurrencies.

On Our Radar

On our radar for the week ahead:

What Will Trump Decide on Iran? We are closely monitoring developments in the Middle East and the next steps from President Trump. If no agreement is reached, further escalation could have significant market implications.
Is the U.S. Clarity Act Close? The U.S. Clarity Act, which aims to establish a comprehensive regulatory framework for crypto, reportedly moved closer to passing last week. Progress here could support increased institutional adoption and positively impact the market.
Can the Exchange Balances Keep Declining? Over a longer horizon, we are watching whether Bitcoin and Ethereum balances on exchanges continue to fall. Sustained declines would suggest ongoing accumulation and a longer-term investment stance among market participants.

Mads Eberhardt

Written 25/03/2026

Should not be considered financial advice. Crypto may involve high risk.