As bitcoin appeared poised to break through the $80,000 threshold, macroeconomic uncertainty has reemerged as a challenge. A recent classified briefing by the Pentagon to U.S.
lawmakers highlighted that clearing mines in the Strait of Hormuz, a critical oil passage, may take a minimum of six months and will only begin after the U.S.-Iran conflict concludes. This briefing, as reported by the Washington Post, also cautioned that gasoline and oil prices might remain elevated until the midterm elections, potentially keeping inflation high and limiting the Federal Reserve's ability to reduce interest rates. This scenario presents a negative backdrop for risk assets, including bitcoin, which is particularly sensitive to interest rates and global liquidity conditions rather than actual economic activity.
Additionally, rising costs for essentials like fuel and food could deter investors from allocating capital to speculative assets. These risks are already manifesting in markets, with WTI crude prices surging to around $95 from $79 late last week, and government bond yields increasing across major economies. The U.S.
10-year yield has risen by eight basis points to 4.32% this week, while its U.K. counterpart has increased by 18 basis points to 4.96%. According to Michael Kramer, founder and CEO of Mott Capital Management, "Oil prices are rising alongside yields and widening volatility spreads, signaling tighter financial conditions and increasing market risks." Despite these challenges, U.S.-listed spot bitcoin ETFs continue to see sustained demand, with the fastest inflows in a month based on the seven-day moving average of net flows tracked by Glassnode. However, some analysts advise caution, noting that the rally lacks broad support in the spot market.
Julio Moreno, head of research at CryptoQuant, warned that the recent Bitcoin price increase is driven by demand in the perpetual futures market, while spot demand is still contracting, posing risks of a correction if traders start taking profits. The market capitalization of USDT, the largest dollar-pegged stablecoin, has reached a record high of $188.88 billion, and speculation in certain tokens is intensifying, with overcrowding in bullish bets. For more analysis on today's activity in altcoins and derivatives, see Crypto Markets Today, and for a comprehensive list of events this week, refer to CoinDesk's 'Crypto Week Ahead.'