Bitcoin Plummets to $76,000 Following Iran's Reversal on Hormuz

One of the most substantial short squeezes of 2026 occurred within a single session. Bitcoin surged to $78,000 late on Friday, prompting the liquidation of $762 million in positions across 168,336 traders, with $593 million of these being short positions, according to CoinGlass. By Saturday evening, bitcoin had retreated to $76,091, marking a mere 0.8% increase for the day, as Iran announced the reclosure of the Strait of Hormuz to maritime traffic, less than 24 hours after its foreign minister declared it fully open. This development was reportedly in response to a U.S. blockade of Iranian shipping, with state news agency Nour stating that the strait was under 'strict management and control by the armed forces'. Two tanker owners informed Bloomberg that their vessels received Iranian radio transmissions instructing them to shut down the waterway, with one supertanker even reporting gunfire and aborting its transit. The initial reopening of the strait on Friday had sparked a breakout rally, culminating in a $590 million rout of shorts, with bitcoin accounting for $381 million in liquidations, followed by ether shorts at $167 million. The funding rates on bitcoin perpetuals had been negative for weeks, indicating that shorts were paying longs a premium to maintain their positions. However, the Hormuz reopening served as the catalyst that triggered the flip. Crude oil prices plummeted nearly 10% to $85.90 per barrel following the initial headline, and bitcoin broke above the $76,000-$78,000 zone that had capped every rally attempt since the February 5 crash. Nevertheless, the optimism was short-lived, as President Donald Trump's claim that Iran had agreed to an 'unlimited' suspension of its nuclear program was not confirmed by Tehran. The market pattern that has emerged is one where ceasefire headlines drive a rally, only to be followed by a reversal headline that arrives before the breakout can consolidate, resulting in a forced unwind that sets up another challenge. Ether demonstrated greater resilience than bitcoin during the retreat, declining by only 0.2% over 24 hours, while solana dropped 1.3% and dogecoin fell 2.1%. On a weekly basis, ether is still up 5.2%, with XRP leading at 6.4%, BNB adding 4.6%, and bitcoin sitting at 4.5%. The key question now is whether the $76,000 zone will hold into Monday's open. A clean weekly close above $76,000 would preserve the structural break, even if the peace trade continues to whipsaw. Conversely, a loss of this level would see bitcoin return to the same range it has been trapped in since March, albeit with the short base that was recently wiped out seeking to rebuild.