Bitcoin climbed above $71,000 on Friday morning before settling at around $70,547, roughly flat on the day according to data from CoinGecko. The cryptocurrency reached an intraday high of $71,261 early Friday, recovering from a dip below $70,000 the previous day. That earlier decline coincided with Brent crude oil prices surging to $119 per barrel following attacks on energy facilities in the Persian Gulf. The turbulence triggered more than $500 million in crypto liquidations across the market.
Efforts to stabilize oil supplies disrupted in the Strait of Hormuz have been ongoing, providing some relief to financial markets. U.S. Treasury Secretary Scott Bessent has been weighing potential responses to the spike in oil prices. Options under consideration include lifting sanctions on Iranian oil cargoes already at sea and drawing further supplies from the U.S. Strategic Petroleum Reserve. These measures are aimed at easing pressure on global energy markets.
Despite the partial recovery, market participants remain cautious about the possibility of further disruptions. Analysts have warned that oil prices could climb as high as $200 per barrel if the Strait of Hormuz faces an extended closure. The strait is considered a critical chokepoint for global energy supplies, and any prolonged blockage would have wide-reaching consequences. Investors across asset classes are closely monitoring developments in the Middle East.
The relationship between cryptocurrency prices and energy markets has grown more pronounced as institutional investors increasingly treat digital assets as components of broader risk portfolios. Bitcoin’s price movements are described as a second-order consequence of elevated energy costs. Higher oil prices can push inflation upward, potentially prompting the Federal Reserve to keep interest rates elevated for a longer period. Lower interest rates generally encourage investors to move capital into riskier assets, making a prolonged high-rate environment unfavorable for crypto.
GSR research analyst Carlos Guzman explained that sustained high energy prices could overall be bad for crypto by keeping interest rates higher for longer. His comments were made earlier in the month to Decrypt. The correlation between energy market volatility and crypto price swings underscores how macroeconomic forces are increasingly shaping digital asset valuations. Institutional involvement in crypto markets has amplified these cross-market sensitivities.
On prediction market Myriad, owned by Decrypt’s parent company Dastan, users assign a 63% probability that oil’s next significant move will take it to $120 per barrel rather than falling back to $55. Sentiment around Bitcoin has also shifted, with predictors placing a 51% chance on the cryptocurrency’s next move reaching $84,000 rather than $55,000. That figure is down from a high of 65% earlier in the week, reflecting a more cautious outlook among market participants. The shifting probabilities suggest growing uncertainty about Bitcoin’s near-term direction amid ongoing geopolitical tensions.
Originally reported by Decrypt.
