Bitcoin has proven to move in alignment with the stock market. In the last 24 hours, BTC along with other cryptocurrencies surged by 5%, and traded $72,699 as its highest level since the conflict between US and Iran began. Bitcoin, which was considered as the early indicator of positive movement for the market, began to display rising value data again. The surge of BTC's value is in line with the rising stock market. Among them, S&P 500 Futures increased 1.9%, Nasdaq Futures increased 2.2%, and Dow Jones Futures rose by about 1.8%. These data is a good response to the easing of geopolitical tensions.
Through his Truth Social account, Trump stated that he agreed to conduct a ceasefire against Iran for two weeks. Previously, Pakistan, which is a country directly bordering Iran and is a long time ally of America, offered to become a mediator by bringing a peace proposal for America and Iran. As an initial step in considering the peace proposal from Pakistan, America agreed to a ceasefire.
Iran confirmed this ceasefire by announcing a statement that, if military attacks against Iran are suspended, then Iran will reopen the Strait of Hormuz and allow oil tankers to pass through the strait. However, Iran also emphasized that there are two conditions that must be obeyed. First, all those ships must coordinate with Iran’s military forces, so that Iran still maintains full control of this region. Second, Iran mentioned the consideration of technical limitations which could mean that the opened route may be limited.
When Bitcoin’s value and the stock market surged because of this crucial geopolitical moment, world oil prices experienced a quite drastic decline. Oil prices previously surged for several months because of the potential for scarcity during the U.S. and Iran conflict. Now, after the ceasefire statement issued by Trump, oil prices have decreased drastically, especially with Iran's statement of their willingness to reopen the Strait of Hormuz. According to data from CoinDesk, the price of West Texas Intermediate (WTI) crude oil per barrel plunged more than 10% to $95, as well as the price of Brent oil.
In recent months, the conflict between America and Iran has hampered world oil distribution. The fear of investors regarding potential oil scarcity made them flock to buy oil and sell their Bitcoin assets. Many traders became increasingly skeptical of crypto's value and bet that the price would fall because of the war. Once there was news of peace, the price of Bitcoin surged again and began to move inversely with the price of oil. This made traders buy back their Bitcoin, which made the price of Bitcoin surge even higher.
