The brief surge of bitcoin towards $80,000 lost momentum on Monday, with the cryptocurrency's price dropping back to $76,600 during the US trading session, as concerns over geopolitical tensions resurfaced. Following an overnight high near $80,000, its highest point since early February, bitcoin reversed direction, declining by about 1.5% over the past day. Major alternative cryptocurrencies, including ether, XRP, and solana, followed suit, each falling approximately 3%, while the CoinDesk 20 Index, a benchmark for the broader digital asset market, decreased by about 2% on Monday. The decline comes 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.
According to a report by The Wall Street Journal, Iran has proposed a ceasefire on ships in the strait in exchange for a complete end to the war, including the lifting of the US naval blockade and a delay in nuclear talks. Although the proposal aims to restart stalled negotiations, uncertainty remains high after President Trump canceled the planned envoy to Pakistan for negotiations with the Iranian side over the weekend. Meanwhile, oil prices continued their ascent, with Brent crude oil prices rising over 3% to $107 a barrel and West Texas Intermediate crude oil increasing by 2.6% to $97.
The Nasdaq slipped 0.3% in morning trading, retreating from recent record highs, while the S&P 500 remained flat ahead of a significant earnings week that includes major firms such as Alphabet, Meta, Microsoft, and Apple. Crypto-linked stocks also declined, with shares of crypto exchange Coinbase falling 1.5%, Circle, the issuer of the USDC stablecoin, dropping 3.5%, and Galaxy Digital, a digital asset investment firm, sliding nearly 6%. Beneath the surface, bitcoin's price action suggests a market struggling to gain momentum despite strong institutional demand. Bitfinex analysts observed that short-term bitcoin holders who are in profit have been selling, offsetting new demand from ETF buyers and other strategic investors.
The analysts noted that the most likely path in the near term is 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.