The resurgence of the Iran war premium has taken a toll on the crypto market. Over the past 24 hours, bitcoin has fallen 2.1% to $75,633, marking a 3% decline over the week, as Brent crude jumped 7.1% to $126.41 per barrel - its highest intraday level in four years - following an Axios report that President Trump is set to receive a briefing on new military options against Iran. The report also mentioned that the U.S. Central Command has requested the deployment of hypersonic missiles to the Middle East, which would be the first time these weapons have been used in combat by American forces.
The Strait of Hormuz has been effectively closed since the war began in late February, severely limiting the flow of crude oil, natural gas, and oil products. This development has led to a war premium, which refers to the portion of an asset's price driven by conflict risk rather than supply-demand fundamentals.
Brent crude has been carrying a significant war premium all year, with prices rising over 100% year-to-date. The global benchmark is currently on a nine-day winning streak, the longest since May 2022, and has increased by over 100% year-to-date.
Other cryptocurrencies have also been affected, with ether dropping 3.4% to $2,244 and XRP falling 2.1% to $1.37. Solana lost 2.6% to $82.62, while BNB shed 1.9% to $615.
The only notable exception in the top 10, excluding stablecoins, is dogecoin, which rose 3.8% on the day and 10.1% over the week to $0.10. Risk assets are experiencing a decline across the board, with Nasdaq 100 futures erasing an earlier 1.1% rally fueled by strong earnings from Alphabet and Amazon.
The MSCI Asia Pacific share index fell 1.4%, and European equities are expected to drop 1% at the open. The dollar has gained, and bonds have slid as the surge in oil and a hawkish Fed have reduced demand for fixed income. Treasury 10-year yields have held near the highest since July, and Japan's 10-year notes have reached the highest level since 1997, according to Bloomberg. Bitcoin's ability to withstand the early stages of the war is being tested, as the asset has maintained a tight band between $74,000 and $78,000 throughout April, despite oil prices rising from $98 to $126 and the conflict entering its third month.
Each escalation headline has produced a sharper drawdown, and the cumulative damage is starting to show. Bitcoin is now $50,000 below its October 2025 all-time high of $126,000. Fernando Lillo, director at exchange Zoomex, stated in a note that any break above $80,000 would require the war premium to unwind. 'Bitcoin is attempting to break the key $80,000 level, which would necessitate a resolution to the Middle East conflict and, consequently, a drop in Brent crude oil prices below $100 per barrel,' he said.
'One is impossible without the other, and the USA administration's plans for a prolonged naval blockade of Iran are becoming a significant obstacle.' Lillo also flagged a possible scenario where the Trump administration lifts the blockade in the coming days and frames it as a response to 'positive steps by Iran' to engineer a relief rally. 'A potential lifting of restrictions in the region and lower oil prices could trigger an accelerated influx of capital into risk assets, paving the way for Bitcoin to consolidate above $80,000 and move toward $85,000.'