Analysis: If the US-Iran conflict continues for several months, war spending and debt expansion may benefit Bitcoin

Macro strategist Mark Connors stated that if the conflict between the United States and Iran continues for months, the increase in fiscal spending, debt expansion, and declining interest rates brought about by the war could create a favorable environment for Bitcoin.

Connors pointed out that wars typically require financing through the issuance of more government bonds, which will increase the supply of dollars in the financial system, thereby weakening the value of existing currencies and benefiting non-dollar assets like Bitcoin. Since mid-2025, the annualized growth rate of U.S. federal debt has been about 14%, and if this trend continues, the debt size may continue to grow by about 15% year-on-year. He believes that this ongoing debt expansion is essentially a form of "monetary dilution," which has historically been beneficial for Bitcoin's performance. Since the U.S. first launched strikes against Iran, the price of Bitcoin has risen by about 3.6%. As U.S. government debt increases and relies more on short-term bond financing, policymakers may be more inclined to lower interest rates in the future to reduce interest burdens. In an environment of "declining interest rates + ongoing debt expansion," liquidity typically improves, which is precisely the macro backdrop in which Bitcoin has historically performed strongly.