The brief surge of bitcoin towards $80,000 lost momentum on Monday, with the cryptocurrency slipping back to $76,600 during the US trading session as concerns over geopolitical tensions resurfaced. After reaching its highest level since early February, near $80,000, bitcoin reversed its course, experiencing a decline of about 1.5% over the past 24 hours. Major altcoins, including ether, XRP, and solana, followed suit, each dropping around 3%, while the CoinDesk 20 Index, a gauge of the broader digital assets market, fell approximately 2% on Monday.
The downturn is attributed to growing investor caution regarding the outlook for US-Iran negotiations and the ongoing disruption in the Strait of Hormuz, a critical global oil transit route. A recent proposal by Iran to halt attacks on ships in the strait in exchange for a full end to the war, including the lifting of the US naval blockade and a delay in nuclear talks, aims to restart stalled negotiations. However, uncertainty remains high following President Trump's cancellation of envoy visits to Pakistan for negotiations with Iran.
Meanwhile, oil prices continued their ascent, with Brent crude oil rising over 3% to $107 a barrel and West Texas Intermediate crude oil increasing by 2.6% to $97. The Nasdaq experienced a 0.3% decline in morning trading, retreating from recent record highs, while the S&P 500 remained flat ahead of a significant earnings week. Crypto-linked stocks also declined, with Coinbase shares falling 1.5%, Circle dropping 3.5%, and Galaxy Digital sliding nearly 6%.
Underlying bitcoin's price action is a market struggling to gain momentum despite robust institutional demand. Bitfinex analysts observed that short-term bitcoin holders are selling into strength, offsetting new demand from ETF buyers and investment strategies. 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 necessary to confirm a more durable bullish trend.