Bitcoin Price Drops to $76,000 Following Iran's Closure of the Strait of Hormuz

The year 2026 witnessed one of its largest short squeezes, which occurred within a single session. On Friday, Bitcoin reached a high of $78,000, triggering liquidations worth $762 million across 168,336 traders, with $593 million of that amount being attributed to short positions, according to CoinGlass. By Saturday evening, Bitcoin had fallen back 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. Two tanker owners reported receiving Iranian radio transmissions, ordering the closure of the waterway, with one supertanker even experiencing gunfire and aborting its transit. The state news agency Nour stated that the Strait of Hormuz had returned to 'strict management and control by the armed forces' in response to a U.S. blockade of Iranian shipping, prompting several oil tankers to turn back. The breakout rally on Friday ultimately resulted in a $590 million shorts rout, with Bitcoin accounting for $381 million in liquidations, followed by Ether at $167 million. Shorts outnumbered longs by nearly four to one, representing the most significant short-heavy breakdown in a liquidation event since February. The setup for this event had been building for weeks, with funding rates on Bitcoin perpetuals remaining negative, indicating that shorts were paying longs a premium to hold their positions. The initial reopening of the Hormuz Strait on Friday served as the catalyst, causing crude oil prices to drop nearly 10% to $85.90 per barrel and Bitcoin to break above the $76,000-$78,000 zone that had capped every rally attempt since the February 5 crash. However, the situation took a turn when President Donald Trump announced that Iran had agreed to an 'unlimited' suspension of its nuclear program, a claim that Tehran never confirmed. By Saturday, none of these developments remained intact. The market pattern that has emerged is one where ceasefire headlines drive a rally, but a reversal headline arrives before the breakout can consolidate, leading to a forced unwind and another setup to work against. While Bitcoin fell, Ether held up better, dropping only 0.2% over 24 hours, compared to Solana's 1.3% decline and Dogecoin's 2.1% fall. On a weekly basis, Ether is still up 5.2%, XRP leads with a 6.4% increase, BNB added 4.6%, and Bitcoin sits at 4.5%. The 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. A loss of this level would put Bitcoin back in the same range it has been trapped in since March, but this time with the short base that just got wiped out looking to rebuild.