On Monday, during late Asian trading hours, bitcoin's value dropped to $79,074, marking a nearly $1,500 decline from its intraday high of $80,594, the highest level seen since January 31. This downturn was triggered by a report from Iran's Fars news agency, which alleged that two missiles had hit a US patrol boat near Jask Island after the vessel supposedly ignored warnings from Iran to leave its territorial waters. As a result, Brent crude prices jumped over 5% to trade above $113 per barrel before paring some of the gains. Following the US denial of the report, oil and equity futures reduced their initial movements, but bitcoin maintained its decline as traders factored in the fragility of the ceasefire that has been in place since early April.
Other major cryptocurrencies followed bitcoin's downward trend from their intraday highs but remained positive for the day. Ether was trading at $2,341, representing a 1.2% increase over the past 24 hours after reaching $2,368 earlier. Solana was priced at $84.08, up only 0.2% for the day after starting Monday at $85.14.
XRP fell to $1.40, while BNB declined to $623. Dogecoin held its gains relatively better than most, rising 2.3% for the day to $0.1102, with its weekly print still at 12.1%.
This escalation occurred hours after President Donald Trump announced on Truth Social that the US would commence escorting stranded ships in the Persian Gulf through the Strait of Hormuz, starting Monday, as part of an operation dubbed Project Freedom. This operation involves guided-missile destroyers, aircraft, and drones. In response, Iran announced that it had 'redefined the control zone' in Hormuz, extending its maritime borders to Fujairah and signaling that Tehran would regulate shipping traffic in the area, regardless of US operations.
Earlier on Monday, bitcoin had broken the $80,000 threshold for the first time since January, resulting in the liquidation of $301 million in shorts as the move unfolded. The Senate's Clarity Act compromise on stablecoin yield, released on Friday, had been contributing to the risk-on tone heading into the week. The validity of the US denial or the emergence of fresh confirmations from either side will likely set the tone for the remainder of the US session.