The brief surge of bitcoin towards $80,000 lost momentum on Monday, with the cryptocurrency's price retreating to $76,600 during the US trading session as concerns over Iran and rising oil prices resurfaced. Following an overnight high near $80,000, its highest level since early February, bitcoin reversed its course, posting a 1.5% decline over 24 hours. Major alternative cryptocurrencies, including ether, XRP, and solana, also fell, each dropping around 3%, while the CoinDesk 20 Index declined by approximately 2% on Monday. The downturn comes as investors become increasingly cautious about the prospects of US-Iran negotiations and the ongoing disruptions to 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 complete 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 after President Trump canceled plans to send envoys to Pakistan for negotiations with the Iranian side.
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 edged 0.3% lower in morning trading, pulling back from recent record highs, while the S&P 500 remained flat ahead of a significant earnings week. Meanwhile, stocks linked to the crypto sector declined, with Coinbase shares falling 1.5%, Circle dropping 3.5%, and Galaxy Digital sliding nearly 6%. Beneath the surface, bitcoin's price action suggests a market struggling to gain momentum despite robust institutional demand.
Bitfinex analysts observed that short-term bitcoin holders who are in profit have been selling, offsetting new demand from ETF buyers. The analysts noted 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 trend.