Iran warns US and Israel against attacks during Khamenei’s funeral as crypto markets brace for volatility

An Iranian military commander issued a direct warning to the United States and Israel on Thursday, cautioning both nations against any strikes on Iran during the state funeral of Supreme Leader Ayatollah Ali Khamenei. The funeral, stretching from July 4 to July 9 across multiple cities in Iran and Iraq, represents one of the most sensitive geopolitical windows since the airstrikes that killed him on February 28.

For crypto markets, the timing couldn’t be more charged. Bitcoin dropped to roughly $63,000 in the immediate aftermath of the US-Israeli strikes that killed Khamenei, then rebounded above $68,000 once his death was officially confirmed on March 1. That kind of whiplash, roughly an 8% swing in a matter of days, is the type of move that turns geopolitical risk into a trading thesis.

The funeral route and the threat calculus

The multi-day funeral procession will move through Tehran, Qom, the Iraqi cities of Najaf and Karbala, and finally Mashhad.

How Iranian crypto markets responded, and what comes next

Nobitex, Iran’s largest cryptocurrency exchange, saw outflows surge by 700% on the day of the airstrikes, totaling nearly $3 million. In a country where traditional banking rails are constrained by international sanctions, that kind of spike tells a very specific story: people moving money fast, using the only cross-border financial infrastructure available to them.

That $3 million figure might sound modest by global standards. But context matters. Iran’s crypto ecosystem operates under severe restrictions, and Nobitex handles the vast majority of domestic trading volume. A 700% surge in outflows from that single exchange represents a significant acceleration in capital movement.

Prediction markets and the speculation machine

Polymarket, the blockchain-based prediction platform, reported hundreds of millions in volume on contracts tied to US-Iran conflict outcomes and Khamenei’s leadership status. Those contracts resolved after his death was confirmed.

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