Bitcoin climbed above $74,000 on Monday, reaching its highest level in roughly six weeks as a wave of short liquidations pushed prices higher. The rally came despite ongoing investor caution due to rising geopolitical tensions in the Middle East.
The world’s largest cryptocurrency was trading 3.4% higher at $73,892.4 by 02:21 ET (06:21 GMT) after earlier touching a session high of $74,336.9. Bitcoin had already posted strong momentum last week, gaining around 6%, even as global equity markets declined amid concerns that rising oil prices could fuel inflation.
Crypto market gains driven by short liquidations
The broader cryptocurrency market also moved higher as traders who had previously bet on falling prices were forced to close their positions. According to data from CoinGlass, the crypto market recorded approximately $344 million in liquidations over the past 24 hours, with short liquidations accounting for about 83% of the total.
Liquidations occur when leveraged traders are forced to exit their positions after the market moves against them. This process can accelerate price movements and often leads to rapid rallies when short sellers rush to cover their trades.
Despite the rebound in digital assets, investor sentiment remained cautious as the Middle East conflict entered its third week, raising concerns about global energy supplies and the potential impact on inflation.
U.S. President Donald Trump recently urged allied nations to help secure the Strait of Hormuz, a critical shipping route for global oil exports, as tensions in the region continue to escalate.
Oil prices remain elevated amid Middle East tensions
Reports also indicated that drone attacks in Gulf states continued on Monday despite claims from U.S. officials that Iran’s military capabilities had been significantly weakened.
Oil prices remained above $100 per barrel, supported by fears of potential supply disruptions around the Strait of Hormuz, one of the most important transit routes for global crude oil shipments.
Meanwhile, U.S. stock futures edged slightly higher in Asian trading as investors looked ahead to the upcoming Federal Reserve policy meeting later this week. Markets widely expect the central bank to keep interest rates unchanged while evaluating inflation risks.
Analysts say that ongoing geopolitical uncertainty and macroeconomic risks could keep cryptocurrency markets volatile in the near term, even though short covering is currently providing upward momentum.
Altcoins also rally as crypto market rebounds
Most major altcoins also recorded gains during Monday’s trading session as the broader crypto market recovered.
Ethereum, the second-largest cryptocurrency by market capitalization, surged 8% to $2,265.88. Solana and Polygon each climbed around 6%, while Cardano posted a stronger gain of nearly 10%.
Among meme cryptocurrencies, Dogecoin rose approximately 7%.
However, XRP, the third-largest cryptocurrency by market value, moved in the opposite direction and fell 5% to $1.48.
