The resurgence of the Iran war premium has led to a decline in the cryptocurrency market. Over the past 24 hours, bitcoin has fallen by 2.1% to $75,633, while ether has dropped by 3.4% to $2,244.
This downturn is attributed to the recent surge in Brent crude oil prices, which have reached a four-year high of $126.41 per barrel. The increase in oil prices is a result of the escalating tensions in the Middle East, with reports suggesting that President Donald Trump is being briefed on military options against Iran. The deployment of hypersonic missiles to the Middle East has also been requested, which would mark the first time American forces have used such weapons in combat.
The war premium, which refers to the portion of an asset's price driven by conflict risk, has been a significant factor in the increase in oil prices. As a result, the cryptocurrency market has experienced a decline, with most major cryptocurrencies experiencing losses.
However, dogecoin has seen a notable increase, rising by 3.8% over the past 24 hours. The surge in oil prices has also had an impact on the global economy, with risk assets experiencing a decline across the board. The dollar has gained, while bonds have slid, and Treasury 10-year yields have held near the highest since July. The resilience of bitcoin is being tested, as it has held a tight band between $74,000 and $78,000 despite the increase in oil prices.
However, the cumulative damage is starting to show, with bitcoin now $50,000 below its October 2025 all-time high of $126,000. According to Fernando Lillo, director at exchange Zoomex, any break above $80,000 will require the war premium to unwind. He suggests that a resolution to the Middle East conflict and a drop in Brent crude oil prices below $100 per barrel are necessary for bitcoin to break the key $80,000 level.
Lillo also flags a possible scenario where the Trump administration lifts the blockade in the coming days, framing it as a response to 'positive steps by Iran' to engineer a relief rally. This could trigger an accelerated influx of capital into risk assets, paving the way for bitcoin to consolidate above $80,000 and move towards $85,000.