Bitcoin Price Eyes $125,000 as Market Sentiment Shifts Amid US-Iran Peace Talks

Bitcoin was trading at around $74,700 during Asian morning hours on Friday, experiencing a 0.4% decline over 24 hours but still maintaining a 3.5% weekly gain, as the 10-day global equity rally paused ahead of the impending US-Iran ceasefire deadline. Meanwhile, Ether dropped 1.4% to $2,327, yet it continues to lead the majors with a 6% weekly gain, extending its outperformance from earlier in the week. Other notable movements include XRP holding steady at $1.43 with a 6.4% weekly increase, Solana rising 2.7% to $87.67, BNB adding 0.7% to $629.89, and Dogecoin seeing a 5.6% weekly increase to $0.0976. The MSCI All Country World Index reached a record high on Thursday before slipping 0.1% in Asia, while the S&P 500 also achieved an all-time high. However, Brent crude fell 1.2% to $98.20 following President Donald Trump's announcement that prospects for a permanent Iran ceasefire were 'looking very good.' Despite the lack of confirmation from Iran regarding the concessions claimed by Trump, markets are reacting as if a deal is imminent, leading to equities unwinding most of the war premium while crude remains near $98 and the Strait of Hormuz remains effectively shut. Beneath the stagnant bitcoin price action, some traders are focusing on the setup. Bitcoin perpetual funding rates have turned deeply negative, reaching levels last seen in 2023, indicating that the market is heavily positioned against the price. According to Daniel Reis-Faria, CEO of ZeroStack, 'Funding rates this negative tell you the market is heavily short. If Bitcoin continues to move higher despite that, a lot of those positions could get liquidated, and the move can accelerate quickly.' Reis-Faria anticipates that bitcoin could reach $125,000 within the next 30 to 60 days if the short base gets squeezed out. Conversely, on-chain analyst CryptoVizArt suggests that bitcoin's 'True Market Mean,' which estimates the average cost basis of active investors by filtering out lost and dormant coins, indicates that the average active holder is currently underwater. Historically, meaningful stretches below the True Market Mean have coincided with bitcoin's worst periods. While these two perspectives may seem conflicting, they can both be true, with a short squeeze from negative funding potentially triggering an outsized rally that is eventually sold into by underwater holders. The dominant scenario likely depends on whether the US-Iran ceasefire extension holds past next week.