Iran war will move traditional market onchain faster than expected, says Bitwise

The war in Iran will force traditional financial markets to ramp up their timelines to move onchain, according to Bitwise chief investment officer Matt Hougan.

His argument, laid out in a blog on March 3, is that the conflict in the Middle East has shown that traders can no longer afford to be shut out of the markets for days as world events spin out of control around them.

“I imagined it would take [five to ten] years,” Hougan wrote. “This weekend proved me wrong. Now I’m convinced it’s going to happen much faster than that.”

His argument cuts to the core of an argument laid out by both crypto players and Wall Street giants: That blockchain technology will transform the world economy by tokenising real world assets like stocks, oil and gold to ensure speed, fairness and to end corruption.

Hougan points at how traders who were shut out of traditional markets over the weekend turned to crypto instead.

Trading volume on Hyperliquid and Tether’s tokenised gold both soared over the weekend, Hougan noted. Major prediction markets saw record volume.

“It was the first time I remember crypto-enabled markets being ‘the market,’ full stop,” he wrote.

Major traditional markets only operate at select hours Monday through Friday. Smaller markets such as those in Saudi Arabia and Qatar, trade Sunday through Thursday, Hougan noted.

While that concentrates traders, ensuring markets are highly liquid, it also means those traders are unable to react to events that happen during nights and weekends.

And it wasn’t until well after markets closed on Friday that media outlets reported Israel and the US had bombed Iran, potentially setting off a regional war that could ensnare some of the world’s largest oil producers.

“Trading volume on Hyperliquid spiked so much that, when Bloomberg wanted to write about how crude oil responded to the bombing, it cited the Hyperliquid crude oil contract as the most relevant price,” Hougan wrote.

While traditional markets are primed to extend their hours during the work week, Hougan said that wouldn’t be enough to stave off the threat posed by crypto.

After the events of this past weekend, he says the transition will happen much faster than he’d first anticipated.

Aleks Gilbert is DL News’ New York-based DeFi correspondent. You can reach him at [e-mail].