Bitcoin held above $78,000 while Brent crude breached $100 for the first time since July 24, driven by an escalation in the Middle East that raised concerns over supplies through the Strait of Hormuz and Red Sea. CryptoSlate data showed the flagship cryptocurrency trading around $78,451 at press time.
Brent touched $100.19 before easing slightly, extending a roughly 25% advance since early August. Simultaneously, the US 10-year Treasury yield climbed toward 4.81% as investors weighed the inflationary consequences of rising energy costs. Allianz chief economic advisor Mohamed El-Erian noted that the combination of higher gasoline prices and rising bond yields has historically posed challenges for Bitcoin by reinforcing inflation, limiting Federal Reserve easing, and increasing the appeal of interest-bearing assets.
Markets priced in a 60.4% probability of a quarter-point Fed increase at the upcoming meeting following a stronger-than-expected employment report. Despite these conditions, Bitcoin's ability to remain above $78,000 provides a live test of whether its relationship with traditional markets is shifting. Research from Talos noted that Bitcoin's 90-day correlation with gold rose to 0.56—its highest since 2020—while correlations with the Nasdaq 100 and US dollar fell close to zero. However, Talos identified elevated real rates as a main threat to this emerging gold-like trading pattern.
The macroeconomic backdrop also introduces pressures through global supply chains and currency markets. Goldman Sachs warned that crude could climb as high as $120 a barrel if attacks on Middle Eastern vessels broaden. Meanwhile, Bitwise Europe head of research André Dragosch pointed to potential bond-market transmission channels involving Chinese oil purchases, Japan's import bills, and potential pressure on Japanese investors to reduce US Treasury holdings.
Bitcoin's resilience faces an immediate test with the release of the August Consumer Price Index (CPI). Core inflation is expected to ease to 2.4% annually from 2.5% in July. Talos reported that core CPI releases have generated Bitcoin moves about 1.8 times larger than ordinary 30-minute trading windows since January 2025.
Adding to market sensitivity, Alphractal CEO Joao Wedson stated that leverage has built up again with positions largely tilted long, leaving the market vulnerable to potential liquidations if macroeconomic data produces a downside move.
