The resurgence of the Iran war premium has negatively impacted the cryptocurrency market. Over the past 24 hours, bitcoin has decreased by 2.1% to $75,633, representing a 3% decline over the week, while Brent crude oil prices have surged 7.1% to $126.41 per barrel, reaching a four-year high, following an Axios report that President Donald Trump is scheduled to receive a briefing on new military options against Iran. This development has led to the deployment of hypersonic missiles to the Middle East, marking the first instance of their use in combat by US forces. The Strait of Hormuz has been effectively closed since the onset of the conflict in late February, resulting in a significant disruption to crude oil, natural gas, and oil product flows.
The war premium, which refers to the portion of an asset's price driven by conflict risk rather than fundamental supply and demand, has been a significant factor in Brent crude oil prices this year, with prices increasing by over 100% year-to-date. The global benchmark is currently experiencing a nine-day winning streak, its longest since May 2022, and has risen by over 100% year-to-date. Ether has declined by 3.4% to $2,244, representing a 4.4% decrease over the week, while XRP has fallen by 2.1% to $1.37, a 3.7% decline over seven days.
Solana has lost 2.6% to $82.62, and BNB has shed 1.9% to $615. The only notable gainer in the top 10, excluding stablecoins, is dogecoin, which has increased by 3.8% on the day and 10.1% over the week to $0.10. Risk assets are experiencing a broad decline, with Nasdaq 100 futures erasing an earlier 1.1% rally 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 declined as the surge in oil prices and a hawkish Fed have reduced demand for fixed income. Treasury 10-year yields have remained near their highest level since July, while Japan's 10-year notes have reached their highest level since 1997, according to Bloomberg. Bitcoin's resilience during the early stages of the conflict is being tested, with the asset having maintained a narrow range between $74,000 and $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 beginning to manifest. Bitcoin is currently $50,000 below its October 2025 all-time high of $126,000.
According to Fernando Lillo, director at exchange Zoomex, a break above $80,000 requires the war premium to unwind. Lillo stated that bitcoin is attempting to break the key $80,000 level, which would necessitate a resolution to the Middle East conflict and a subsequent decline in Brent crude oil prices below $100 per barrel. He noted that one is impossible without the other and that the US administration's plans for a prolonged naval blockade of Iran are becoming a significant obstacle.
Lillo also suggested 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' to engineer a relief rally. He added that a potential lifting of restrictions in the region and lower oil prices could trigger an accelerated influx of capital into risk assets, paving the way for bitcoin to consolidate above $80,000 and move toward $85,000.