The largest cryptocurrency rose to $74,901, the highest since March 17, before paring some of those gains. Smaller tokens like Ether also saw gains of 5%.
This recovery comes after US President Donald Trump claimed that Iran has reached out to his administration to resume peace talks, even as the US began a naval blockade of the Strait of Hormuz. In hopes of talks resuming soon, Asian equities too have advanced this morning.
“Bitcoin is following the rally in broader risk assets,” said Damien Loh, chief investment officer at Ericsenz Capital. “Even though a blockade was initiated, the market took it as a positive that Trump effectively extended the time-line to make a deal and that he is reportedly seeking another round of talks.”
Analysts believe that Bitcoin may not see a significant move higher until the US passes the Clarity Act, a regulatory framework for digital assets.
Having declined from record highs of $1,26,000 in October last year, Bitcoin has traded in a range but has outperformed other asset classes since the start of the Iran war, having risen 10% during this period, while Gold is down by a similar quantum., declining 10%.
“Bitcoin has been behaving more like a classic risk asset than a traditional safe haven, and the improvement in overall risk sentiment this month has provided a tailwind for its recent gains,” IG Markets analyst Tony Sycamore wrote in a note. “For a more bullish medium-term outlook to develop, Bitcoin would need to see a sustained break and close above trend-channel resistance at $79,000.”
(With Inputs From Agencies)