The resurgence of the Iran war premium has negatively impacted the cryptocurrency market. Over the past 24 hours, bitcoin has fallen 2.1% to $75,633, while ether has dropped 3.4% to $2,244. This decline is attributed to the significant increase in Brent crude oil prices, which have reached a four-year high of $126.41 per barrel. The rise in oil prices is largely due to reports that President Donald Trump is set to receive a briefing on potential military action against Iran, sparking concerns of an escalation in the conflict.
As a result, the global benchmark for oil has experienced a nine-day winning streak, with prices increasing by over 100% year-to-date. The cryptocurrency market has followed suit, with most major coins experiencing declines. However, dogecoin has bucked the trend, rising 3.8% on the day and 10.1% on the week.
The surge in oil prices and the hawkish stance of the Federal Reserve have also led to a decline in risk assets, with the Nasdaq 100 futures and European equities experiencing losses. The dollar has gained, while bonds have slid, leading to a decrease in demand for fixed income. According to Fernando Lillo, director at exchange Zoomex, any break above $80,000 for bitcoin would require a resolution to the Middle East conflict and a subsequent drop in oil prices. Lillo suggests that a potential lifting of restrictions in the region and lower oil prices could trigger an influx of capital into risk assets, paving the way for bitcoin to consolidate above $80,000 and move toward $85,000.