Is Bitcoin mispricing a prolonged Iran war? Ex-hedge fund manager weighs in

In the latest interview with Cointelegraph, macro investor and former hedge fund manager James Lavish issued a stark warning to Bitcoin holders and global investors: markets may be pricing in a quick resolution to the Iran conflict — but if that assumption proves wrong, the consequences could be severe.

Lavish argued that if the conflict drags on and keeps pressure on oil prices, the result could be a fresh inflation shock, renewed fears of stagflation and a major repricing across global markets.

In his view, this scenario would put the Federal Reserve in an impossible position: unable to raise rates aggressively without risking recession, yet unable to cut rates due to persistent inflation.

That is where the conversation becomes especially relevant for Bitcoin (BTC). Lavish explains why Bitcoin has behaved differently from gold and equities in recent months, and why that relative resilience may not last in a true “correlation-to-one” panic event. 

If markets suffer a deeper drawdown, he says, Bitcoin could fall another 10% to 20%, potentially revisiting the low $50,000 or even high $40,000 range.

And yet, Lavish is far from bearish in the long run.

One of the most compelling parts of the interview is his argument that such a sell-off would not destroy the Bitcoin thesis — it could actually create a major opportunity. He also explains why investors should avoid being either too levered or completely unexposed in a market driven by war headlines, bond stress and rapidly shifting expectations around Fed policy.

The interview also touches on safe haven investments, energy markets, Treasury yields and money printing. 

If you want to understand how an experienced macro investor thinks about war risk, recession risk and Bitcoin’s next move, watch the full interview on our YouTube channel and don’t forget to subscribe!