The brief surge of bitcoin towards $80,000 lost momentum on Monday, with prices dropping to $76,600 during the US trading session as concerns over geopolitical risks resurfaced. Following an overnight high near $80,000, its highest level since early February, the largest cryptocurrency reversed direction, posting a 1.5% decline over 24 hours. Major alternative cryptocurrencies, including ether, XRP, and solana, each plummeted around 3%, while the CoinDesk 20 Index, a benchmark for the broader digital assets market, fell 2% on Monday.
The pullback occurs as investors become increasingly cautious about the prospects of US-Iran negotiations and the ongoing disruption to the Strait of Hormuz, a critical global oil transit route. According to a report, Iran has proposed a ceasefire on ships in the strait in exchange for a full end to the war, including the lifting of the US naval blockade and postponing nuclear talks.
However, uncertainty remains high after President Trump canceled the planned envoy to Pakistan for negotiations with Iran. Oil prices continued to rise, with Brent crude oil climbing over 3% to $107 a barrel and West Texas Intermediate crude oil up 2.6% to $97. The Nasdaq declined 0.3% in morning trading, retreating from recent record highs, while the S&P 500 remained flat ahead of a significant earnings week. Crypto-related stocks also declined, with Coinbase shares falling 1.5%, Circle dropping 3.5%, and Galaxy Digital sliding nearly 6%.
Underlying the price action, bitcoin's market is struggling to gain momentum despite strong institutional demand. Bitfinex analysts observed that short-term holders are selling into strength, offsetting new demand from ETF buyers. The analysts noted that the near-term path of least resistance is likely consolidation or a pullback towards $75,000, adding that a decisive break above $80,000 is necessary to confirm a more durable bullish trend.