Bitcoin's brief surge towards $80,000 lost momentum on Monday, with the cryptocurrency's price slipping back to $76,600 during the US trading session, as geopolitical concerns regained attention. After reaching nearly $80,000 overnight, its highest level since early February, bitcoin reversed direction, posting a 1.5% decline over the past 24 hours. Major alternative cryptocurrencies, including ether, XRP, and solana, followed suit, each falling around 3%, while the CoinDesk 20 Index, a benchmark for the broader digital assets market, dropped about 2% on Monday.
The pullback occurs as investors become increasingly cautious about the outlook for US-Iran negotiations and the ongoing disruption to the Strait of Hormuz, a crucial global oil transit route. A recent Wall Street Journal report revealed that Iran has proposed halting attacks on ships in the strait in exchange for a full end to the war, including the lifting of the US naval blockade and delaying nuclear talks.
However, uncertainty remains high after President Trump canceled sending envoys to Pakistan for negotiating with the Iranian side. Oil prices continued to climb, with Brent crude oil prices rising over 3% to $107 a barrel, and West Texas Intermediate crude oil increasing 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 featuring firms such as Alphabet, Meta, Microsoft, and Apple.
Meanwhile, crypto-linked stocks declined across the board, with shares of crypto exchange Coinbase falling 1.5%, Circle dropping 3.5%, and Galaxy Digital sliding nearly 6%. Underlying bitcoin's price action is a market struggling to build momentum despite strong institutional demand. Bitfinex analysts noted that short-term bitcoin holders in profit have been selling into strength, offsetting fresh demand from ETF buyers and Strategy.
The analysts predict that the path of least resistance in the near term is likely consolidation or a pullback towards the $75,000 region, adding that a decisive break above $80,000 is required to confirm a more durable bullish regime.