Leading cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH) are bouncing higher as crude oil prices fall 5% from their recent highs.
Bitcoin, the largest cryptocurrency by market capitalization, is back trading at $77,000 U.S. after falling close to $75,000 U.S. over the weekend.
BTC has tread water right around $77,000 U.S. over the past week as investors remained on the sidelines with cryptocurrencies.
But now, digital asset prices are recovering on hopes that the U.S. and Iran are close to reaching a deal that will reopen the Strait of Hormuz shipping lane.
About 20% of the world’s crude oil is shipped through the Strait of Hormuz near Iran, and the waterway has been effectively closed since war broke out with the U.S. and Israel on Feb. 28.
Signs that the strait might now reopen to commercial shipping has sent oil prices down 5%, with Brent crude, the international benchmark, trading below $100 U.S. at $97.50 U.S. per barrel.
Lower oil prices have taken pressure off risk assets such as crypto. As a result, XRP (XRP) and Solana (SOL) are each up 0.6% and Ethereum has gained 0.4% on May 25.
While the U.S. market is closed for the Memorial Day holiday, other markets around the world are seeing stocks surge higher, including in Asia and throughout Europe.
Despite the tentative recovery, some analysts remain cautious about Bitcoin, citing more than $2 billion U.S. in outflows from spot exchange-traded funds (ETFs) over the past two weeks.
Cryptocurrencies trade around the clock: 24 hours per day, seven days a week.
