The brief surge of bitcoin towards $80,000 lost steam on Monday, with the cryptocurrency slipping back to $76,600 during US trading hours as geopolitical concerns resurfaced. Following an overnight trading session near $80,000, its highest point since early February, bitcoin reversed direction, posting a 1.5% decline over 24 hours. Major alternative cryptocurrencies trailed behind, with declines of around 3% for ether, XRP, and solana, while the CoinDesk 20 Index, a benchmark for the broader digital asset market, fell 2% on Monday. The pullback is attributed to growing investor caution regarding the outlook for US-Iran negotiations and the ongoing disruption in 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 full end to the war, including the lifting of the US naval blockade and delayed nuclear talks, aims to revive 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 climbing over 3% to $107 per barrel and West Texas Intermediate crude rising 2.6% to $97.
The Nasdaq dipped 0.3% in morning trading, retreating from recent record highs, while the S&P 500 remained flat ahead of a significant earnings week featuring major firms like Alphabet, Meta, Microsoft, and Apple. Meanwhile, stocks linked to cryptocurrencies declined across the board, with Coinbase shares falling 1.5%, Circle dropping 3.5%, and Galaxy Digital sliding nearly 6%. Beneath the surface, bitcoin's price action suggests a market struggling to gain momentum despite robust institutional demand.
Bitfinex analysts observed that short-term bitcoin holders in profit have been selling into strength, offsetting fresh demand from ETF buyers and strategists. According to the analysts, the most likely near-term path is consolidation or a pullback towards the $75,000 region, and a decisive break above $80,000 is necessary to confirm a more durable bullish trend.