Bitcoin reclaims $74K as Hormuz blockade ends, oil slides

Bitcoin surged past $74,000 after President Donald Trump lifted the naval blockade on the Strait of Hormuz, removing a key geopolitical risk that had suppressed risk appetite across markets.

Bitcoin rose 4.2% to $74,200 as of 14:00 UTC, recovering from a dip below $71,000 after the Strait of Hormuz reopened to commercial traffic. The swift reversal marked one of Bitcoin's sharpest intraday recoveries in weeks.

"The removal of the blockade eliminates a tail risk that had kept crypto markets in a defensive posture for weeks," said Nina Volkov, crypto macro analyst at Edgen. "Traders are rotating back into risk assets as oil prices decline and the geopolitical premium unwinds."

The rebound came after Trump announced on Truth Social that Iran had agreed to "highest level Nuclear inspections long into the future," allowing the strait — through which one-fifth of the world's hydrocarbons transit — to remain open. Oil prices fell, with Brent crude trading near $75 a barrel and West Texas Intermediate around $73, down more than 4% over the past five days. Shipping traffic through the waterway rose to 109 vessels over the weekend, the highest since the conflict began in late February, according to Kpler data.

The unwinding of the Hormuz risk premium could sustain Bitcoin's rally if oil continues to slide, lowering inflation expectations and reducing pressure on central banks to maintain restrictive policy. The next resistance level sits at $76,500, with support at $71,000, according to Coinglass liquidation heatmaps.

Open interest across major exchanges rose 6% to $38.2 billion, while funding rates flipped positive for the first time in three days, signaling renewed demand for long exposure, Coinglass data show. Bitcoin's 24-hour trading volume reached $42.8 billion, well above the seven-day average of $31.5 billion, according to CoinGecko. The move also dragged Ethereum higher, with ETH gaining 3.1% to $3,920, as the broader crypto market capitalization added roughly $120 billion.

The decline in crude prices — Brent has fallen from war-time highs above $100 a barrel to $75 — could feed into lower headline inflation readings in coming months, potentially accelerating the timeline for Federal Reserve rate cuts. Fed funds futures currently price a 45% probability of a cut at the September meeting, up from 32% a week ago.

However, risks persist. The Strait of Hormuz is not yet fully cleared of mines, and Iran's Islamic Revolutionary Guard Corps has signaled it may still attempt to control traffic through the waterway. Any re-escalation could reverse the risk-on move just as quickly as it materialized.

This article is for informational purposes only and does not constitute investment advice.