Iran refuses to negotiate with the US; how will escalating geopolitical tensions impact the global financial markets?

Iranian Foreign Minister Amir Abdollahian made it clear on the 7th that considering the U.S. policy towards Iran, there are currently no suitable conditions for negotiations with the United States. This statement suggests that the freeze in Iran-U.S. relations may be extended, and geopolitical risks are resurfacing. For global financial markets, such political events often trigger chain reactions through multiple channels such as oil prices, the US dollar, and risk assets.

Why Iran Refuses to Negotiate

Core Attitude Shift

Abdollahian stated during a government cabinet meeting that Trump’s interventionist remarks towards Iran are reckless and dangerous, and Iran’s internal affairs are only relevant to the Iranian people. This is not just diplomatic rhetoric; it reflects the current internal and external pressures Iran faces.

Rising Internal Pressure

According to relevant information, Iran has recently experienced large-scale protests triggered by exchange rate fluctuations, which have spread to 22 provinces, marking the largest such movement since 2022. This indicates that Iran’s economy is under severe pressure, with prominent currency devaluation issues. In this context, the government adopts a tough stance externally, partly to maintain domestic political stability.

What This Means

Reassessment of Geopolitical Risks

Iranian armed forces are prepared to retaliate immediately if sovereignty is violated. While such statements are common, in the context of deteriorating US-Iran relations, they indeed increase the uncertainty of Middle East stability.

Possible Market Impacts

Indirect Impact on the Crypto Market

Historically, geopolitical events tend to impact the crypto market indirectly:

• Short-term Shock: Risk aversion may pressure risk assets like Bitcoin, but could also boost demand for safe-haven assets
• Medium-term Impact: Worsening Iran’s economy may intensify financial stress in emerging markets, tightening global liquidity
• Long-term Consideration: Ongoing political uncertainty could suppress global risk appetite, affecting overall crypto market valuation

It is worth noting that Iran has a certain scale of cryptocurrency mining and usage, but due to international sanctions, its influence remains relatively limited.

Summary

Iran’s refusal to negotiate is not an isolated event but reflects deep-seated contradictions in Middle Eastern geopolitics. Internal protests triggered by exchange rate fluctuations and external pressure from the U.S. create a complex situation that is difficult to resolve in the short term. For global financial markets, the key is to observe whether this incident escalates into substantive conflict. If it remains at the rhetoric level, market impact may be limited; but if it develops into actual action, oil prices could rise significantly, dragging down global risk assets, including cryptocurrencies. Close attention should be paid to U.S. policy developments and Iran’s actual moves.