Key Highlights
- BTC climbed to $78,000 following Iran’s short-lived reopening of the Strait of Hormuz, before retreating to $76,000 as military restrictions resumed within a day.
- The price spike resulted in $762 million worth of liquidations across the crypto market, with short sellers bearing $593 million of the losses.
- Bitcoin ETFs recorded approximately $1 billion in weekly net inflows — marking their strongest performance since January.
- Morgan Stanley’s new Bitcoin Trust fund has accumulated $120 million in assets within its first six days of trading.
- Major altcoins including Ether, XRP, BNB, and Solana closed the week in positive territory despite weekend losses.
Bitcoin experienced dramatic price swings this week, fueled by rapidly shifting geopolitical developments in the Middle East. The digital asset’s volatility centered around breaking news from the strategically critical Strait of Hormuz.
Late last week, Iran’s foreign minister declared the Strait of Hormuz open to commercial vessels throughout the duration of a negotiated ceasefire. President Donald Trump corroborated the announcement, stating Iran had committed to an “unlimited” halt to its nuclear weapons development.
The cryptocurrency market responded immediately, with Bitcoin surging past the $78,000 threshold. Meanwhile, energy markets moved inversely, as Brent crude oil prices plummeted nearly 10% to approximately $85 per barrel.
This sudden rally unleashed one of 2026’s largest short squeezes. According to CoinGlass analytics, the move resulted in $762 million in liquidations affecting 168,336 traders. Bearish positions accounted for $593 million of these forced closures, with bitcoin-specific shorts representing $381 million.
For several weeks prior, funding rates on bitcoin perpetual contracts had remained in negative territory, indicating short sellers were compensating long positions to maintain their bearish bets. The Hormuz announcement served as the catalyst that unwound this crowded trade.
Bitcoin ETF Flows Reach Quarterly Peak
Beyond the headline-grabbing volatility, spot Bitcoin exchange-traded funds posted exceptional results. SoSoValue data reveals that Bitcoin ETFs attracted $996 million in net capital last week.
Friday delivered the week’s strongest performance with $663.9 million in single-day inflows. Aggregate net assets under management across all spot Bitcoin ETFs surpassed $101 billion, while average daily trading volume approached $4.8 billion.
Ethereum-focused ETFs also demonstrated strength, capturing approximately $276 million in weekly inflows, per Farside Investors tracking.
Morgan Stanley’s recently introduced Bitcoin Trust contributed to the institutional adoption trend. Within merely six trading sessions, the product has amassed $120 million in total assets, surpassing WisdomTree’s offering during that timeframe.
Tehran Reverses Position, Sending BTC Lower
In a dramatic about-face occurring less than 24 hours after the initial announcement, Iranian authorities reimposed restrictions on the strait. The state-controlled Nour news agency reported the waterway had returned to “strict management and control by the armed forces,” attributing the decision to an alleged U.S. blockade of Iranian harbors.
Multiple tanker operators confirmed to Bloomberg that their ships received Iranian military radio communications ordering them to halt passage. At least one supertanker crew reported hearing gunfire before reversing direction.
Bitcoin retreated to $76,091 by Saturday evening Asian trading hours, posting a modest 0.8% daily gain. Ethereum declined 3% to approximately $2,365, while Solana shed 1.3% and Dogecoin dropped 2.1%.
Despite the weekend pullback, weekly performance remained positive across major cryptocurrencies. XRP topped the charts with a 6.4% weekly advance. BNB climbed 4.6%, Ether gained 5.2%, and Bitcoin maintained a 4.7% weekly increase.
Market analysts at Bitunix observed that Bitcoin continues trading within an established corridor, facing resistance above $75,000 while finding support around $72,000 based on their most recent assessment.
