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 US-Iran relations and rising oil prices took center stage. Following an overnight high near $80,000, its highest level since early February, bitcoin reversed direction, posting a 1.5% decline over 24 hours.
Major alternative cryptocurrencies, including ether, XRP, and solana, also fell, each declining around 3%, while the CoinDesk 20 Index, a benchmark for the broader digital assets market, dropped 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 vital global oil transit route. According to reports, Iran has proposed a ceasefire 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, aiming to restart stalled negotiations.
However, uncertainty remains elevated after President Trump canceled plans to send envoys to Pakistan for negotiations with Iran. Oil prices continued to climb, with Brent crude rising over 3% to $107 a barrel and West Texas Intermediate crude up 2.6% to $97. The Nasdaq edged 0.3% lower in morning trading, retreating from recent record highs, while the S&P 500 was flat, ahead of a significant earnings week. Meanwhile, stocks linked to the crypto sector declined, with Coinbase, Circle, and Galaxy Digital posting losses.
Beneath the surface, bitcoin's price action suggests a market struggling to gain momentum despite strong institutional demand. Bitfinex analysts observed that short-term bitcoin holders are selling into strength, offsetting new demand from ETF buyers and other investors. The analysts noted 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.