- Bitcoin has added $2,500 as is now approaching $77,000, rebounding from a monthly low earlier today at $74,000.
- Trump’s announcement of a peace deal with Iran boosted the markets, with one analyst saying BTC’s underperformance against stocks is over.
Bitcoin has gained over 3% after President Donald Trump announced that the US was edging closer to a peace deal with Iran and other Middle Eastern countries.
BTC trades at $76,800 at press time, pushing its market cap past $1.53 trillion as the trading volume stayed flat at $28 billion. Earlier today, it dipped to $74,300, its lowest level in four weeks.
The rebound came after President Trump announced that the peace deal with Iran “has been largely negotiated.” He added:
“Final aspects and details of the Deal are currently being discussed and will be announced shortly. In addition to many other elements of the Agreement, the Strait of Hormuz will be opened.”
Iranian officials confirmed the agreement to the New York Times. They said both camps were finalizing an MoU that would end the fighting and reopen the Strait of Hormuz.
The Iranian conflict has weighed heavily on risk assets, with crypto the most affected. Commodities like oil shot up as disruptions in the Strait of Hormuz affected global supply, and stocks soon followed. BTC lagged these assets, prompting investors to question its role as a hedge against geopolitical tensions.
One of these was Mark Cuban, the US billionaire who has backed crypto for years. This week, he announced that he sold off all his BTC after it failed as a hedge against weakening fiat currencies during the Iranian conflict.
The Dallas Mavericks owner and Shark Tank star stated:
“When all this shit hit the fan with the Iran war, Bitcoin was always the best alternative to fiat currency losing its value, and I always thought it was a better version of gold than gold. Well, gold just blew up… Bitcoin dropped. And every time the dollar dropped, Bitcoin should’ve gone up … and it just didn’t do that.”
Analyst: Bitcoin’s Underperformance Against Stocks Is Over
Bitcoin has underwhelmed against most assets this year, from commodities like gold and oil to stocks. However, this underperformance has ended, and BTC is going to outshine these assets, says Mark Connors, the former Credit Suisse global head of portfolio.
Connors, who is now the chief investment officer at Risk Dimensions, noted that BTC has been on its longest period of underperformance against the S&P 500, stretching 142 days. He stated:
“I think bitcoin’s underperformance versus markets is over. It’s in the consolidation phase that has shifted into an outperformance phase.”
The market is adjusting to an environment where interest rates will remain high for much longer. Bitcoin took the hit from this early, but it will also emerge out of it first.
