The brief surge of bitcoin towards $80,000 lost momentum on Monday, with the cryptocurrency's value dropping to $76,600 during the US trading session, as concerns over geopolitical tensions resurfaced. Following an overnight trade near $80,000, its highest level since early February, bitcoin reversed direction, posting a 1.5% decline over 24 hours. Major alternative cryptocurrencies, including ether, XRP, and solana, also fell by approximately 3%, while the CoinDesk 20 Index, a benchmark for the broader digital assets market, decreased by about 2% on Monday.
The downturn is attributed to growing investor caution regarding the outlook for US-Iran negotiations and the ongoing disruption to the Strait of Hormuz, a critical global oil transit route. According to a report by the Wall Street Journal, Iran has proposed a cessation of attacks on ships in the strait in exchange for a comprehensive end to the war, including the lifting of the US naval blockade and a delay in nuclear talks. This proposal aims to restart stalled negotiations, but uncertainty remains high after President Trump canceled the planned envoy to Pakistan for negotiations with the Iranian side over the weekend.
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 edged 0.3% lower in morning trading, retreating from recent record highs, while the S&P 500 remained flat ahead of a significant earnings week featuring firms like Alphabet, Meta, Microsoft, and Apple.
Meanwhile, stocks linked to cryptocurrency declined across the board, with Coinbase shares falling 1.5%, Circle dropping 3.5%, and Galaxy Digital sliding nearly 6%. Bitfinex analysts observed that short-term bitcoin holders who are in profit have been selling, offsetting fresh demand from ETF buyers and investment strategies.
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.