The specter of war with Iran has returned, and the cryptocurrency market is feeling the effects. Bitcoin has slid 2.1% over the past 24 hours to $75,633, marking a 3% decline for the week, as Brent crude oil jumped 7.1% to $126.41 a barrel - its highest level in four years - following reports that President Donald Trump is set to receive a briefing on new military options against Iran. The report also indicated that US Central Command has requested the deployment of hypersonic missiles to the Middle East, which would be the first time such weapons have been used in combat by American forces.
The Strait of Hormuz has been effectively closed since the conflict began in late February, severely limiting the flow of crude oil, natural gas, and petroleum products. This has resulted in a war premium being factored into asset prices, driven by the risk of conflict rather than supply and demand fundamentals.
Brent crude has been carrying a significant war premium all year, with prices rising over 100% year-to-date. The global benchmark is currently on a nine-day winning streak, its longest since May 2022, and has increased by over 100% year-to-date.
Ether has fallen 3.4% to $2,244 and is down 4.4% for the week, while XRP has dropped 2.1% to $1.37, a decline of 3.7% over seven days. Solana has lost 2.6% to $82.62, and BNB has shed 1.9% to $615.
The only top-10 cryptocurrency to show gains outside of stablecoins is dogecoin, which is up 3.8% on the day and 10.1% for the week to $0.10. Risk assets are broadly retreating, with Nasdaq 100 futures erasing earlier gains fueled by strong earnings from Alphabet and Amazon, MSCI's Asia Pacific share index falling 1.4%, and European equities poised to drop 1% at the open. The US dollar has gained, and bond prices have slid as the surge in oil prices and a hawkish Fed have reduced demand for fixed income. Treasury 10-year yields are near their highest levels since July, while Japan's 10-year notes have reached their highest level since 1997, according to Bloomberg.
Bitcoin's ability to withstand the early stages of the conflict is being tested. The asset has traded within a narrow range of $74,000 to $78,000 throughout April, despite oil prices rising from $98 to $126 and the conflict entering its third month. Each escalation in the conflict has resulted in a sharper decline, and the cumulative damage is now becoming apparent.
Bitcoin is currently $50,000 below its October 2025 all-time high of $126,000. Fernando Lillo, director at exchange Zoomex, noted in a report that any break above $80,000 would require the war premium to dissipate. 'Bitcoin is attempting to break through the key $80,000 level, which would necessitate a resolution to the Middle East conflict and, consequently, a drop in Brent crude oil prices below $100 per barrel,' he stated. 'One is impossible without the other, and the US administration's plans for a prolonged naval blockade of Iran are becoming a significant obstacle.' Lillo identified a possible scenario in which the Trump administration lifts the blockade in the coming days and frames it as a response to 'positive steps' by Iran, potentially triggering a relief rally.
'A potential lifting of restrictions in the region and lower oil prices could lead to an accelerated influx of capital into risk assets, paving the way for Bitcoin to consolidate above $80,000 and move toward $85,000.'