The brief surge of bitcoin towards $80,000 lost momentum on Monday, with the cryptocurrency's price slipping to $76,600 during the US trading session as concerns over geopolitical tensions resurfaced. Following an overnight high near $80,000, its highest point since early February, bitcoin reversed direction, posting a 1.5% decline over 24 hours.
Major alternative cryptocurrencies, including ether, XRP, and solana, each fell around 3%, while the CoinDesk 20 Index, a benchmark for the broader digital asset market, dropped about 2% on Monday. The pullback is attributed to growing investor caution regarding the outlook for US-Iran negotiations and the ongoing disruption to the Strait of Hormuz, a critical global oil transit route. A recent proposal by Iran to halt attacks on ships in the strait in exchange for a complete end to the war, including the lifting of the US naval blockade and a delay in nuclear talks, aims to restart stalled negotiations.
However, uncertainty remains high after President Trump canceled plans to send envoys to Pakistan for negotiations with Iran. Oil prices continued their ascent, with Brent crude oil climbing over 3% to $107 a barrel and West Texas Intermediate crude oil rising 2.6% to $97. The Nasdaq edged 0.3% lower in morning trading, retreating from recent record highs, while the S&P 500 remained flat ahead of a significant earnings week.
Meanwhile, stocks linked to the crypto sector declined across the board, with Coinbase, Circle, and Galaxy Digital posting declines. Underlying bitcoin's price action is a market struggling to gain momentum despite robust institutional demand.
Bitfinex analysts observed that short-term bitcoin holders are selling into strength, offsetting fresh demand from ETF buyers. The analysts predict that the near-term path of least resistance is likely consolidation or a pullback towards the $75,000 region, adding that a decisive break above $80,000 is necessary to confirm a more durable bullish trend.