Bitcoin’s resilience during the latest bout of global macro stress is starting to turn heads on trading desks.

The largest crypto climbed to just shy of $71,000, up roughly 7% from Sunday evening lows, even as geopolitical tensions escalated over the Iran conflict and markets grappled with risks ranging from oil supply disruptions to stress in private credit markets.

That relative strength is beginning to stand out. The Nasdaq 100 and S&P 500 have been roughly flat over the same time, while gold — typically a go-to safe haven during turmoil — has booked only modest gains. Looking at performance so far in March, BTC is the only one of the three posting gains.

Bitcoin is also showing early signs of breaking away from its tight correlation with embattled software stocks. Over the past five days, BlackRock's spot bitcoin ETF (IBIT) is up 3.75%, while the iShares Expanded Tech-Software ETF (IGV) is down 2.45%.

The price action is turning analysts cautiously optimistic that the crypto market may finally be stabilizing after months of declines.

Seller exhaustion

Aurelie Barthere, principal research analyst at Nansen, said one encouraging signal is how little BTC has reacted to fresh geopolitical headlines.

Earlier in the week, a brief wave of optimism lifted equities and crypto alongside softer oil prices, suggesting markets were tentatively pricing in a potential de-escalation in the Iran conflict. But as the session progressed, that optimism faded, and risk assets gave back some of their gains.

"Bitcoin’s downside sensitivity has been relatively limited," she said, noting that some traditional benchmarks such as the Euro Stoxx index have fallen more sharply during the same period.

That resilience suggests the marginal seller in bitcoin may be less aggressive than in equities, Barthere added.

Shifting correlation with gold

Another shift catching traders’ attention is bitcoin’s changing relationship with gold.

According to Bryan Tan, trader at crypto trading firm Wintermute, the BTC–gold correlation has flipped positive, moving to +0.16 from -0.49 a week ago.

During the initial phase of the Middle East conflict, bitcoin fell while gold rallied in a classic risk-off move, Tan noted. More recently, both assets have risen together while the U.S. dollar weakened, suggesting investors may be starting to treat them as beneficiaries of dollar softness rather than opposing risk trades.

"If this correlation continues trending positively, it shifts the narrative around BTC in a conflict environment from 'sell the risk asset' to something more nuanced," Tan said.

ETF flows return

Improving bitcoin ETF flows may also be supporting the recent strength.

Bitcoin ETF flows had been trending negative for months following the peak in October. But data from the past two weeks shows a notable improvement, noted Joe Edwards, head of research at Enigma, particularly with consistent inflows into BlackRock’s IBIT fund, the largest of the bitcoin ETFs.

A sustained recovery in ETF demand could be critical for bitcoin, he added. A sustained recovery in ETF demand could be critical, he added. Many analysts believe bitcoin’s next phase of growth depends on access to deeper institutional capital pools, such as ETF investors in brokerage accounts. With that in mind, the recent wave of outflows was concerning, Edwards said.

The "good news," he said, is that there are signs of that period ending.

IBIT has attracted nearly $1 billion in fresh inflows so far in March, after losing more than $3 billion between November and February, data by SoSoValue shows.

If the trend holds through the coming weeks, Edwards argued, it could support a broader bitcoin recovery into the second quarter.