Fighting again in the Strait of Hormuz between Iran and the U.S. leads to the liquidation of over $269 million for Bitcoin bulls

On May 8, the U.S. and Iranian militaries launched a new round of direct clashes in the Strait of Hormuz. The U.S. Central Command said a U.S. Navy destroyer was attacked by Iran using missiles, drones, and fast boats. The U.S. forces then retaliated, striking Iran’s missile launch sites, command-and-control centers, and intelligence, surveillance and reconnaissance nodes, while also hitting the ports of Geshm and Abbas. Geopolitical risk spiked sharply: on Friday, Bitcoin fell below the $80,000 threshold, with an intraday low of $79,692.

Strait of Hormuz clash: The U.S. and Iran each tell a different story, and the ceasefire deal is on shaky ground

The U.S. Central Command said Iran used multiple missiles, drones, and fast boats against three U.S. ships, but “U.S. vessels were not hit.” The U.S. military eliminated the incoming threats and struck relevant Iranian facilities.

Iranian armed forces, however, claimed the U.S. side violated the ceasefire first, saying U.S. strikes hit oil tankers in the Strait of Hormuz and ships near the port of Fujairah, and it said its retaliation against U.S. warships caused “major losses.”

U.S. President Trump said the strike was a “light punishment” for Iran, stressing the ceasefire agreement is still in effect, but warning that if Iran does not quickly sign the agreement, it will be met with “stronger and more forceful measures.” The clash occurred two days after Iran fired 15 ballistic and cruise missiles toward the port of Fujairah in the UAE. To date, there has been no sign of any concession on the two core demands in the U.S.-Iran talks—reopening the Strait of Hormuz and pausing uranium enrichment.

Bitcoin loses the $80,000 level: CryptoQuant characterizes it as a “bear market rally”

Bitcoin surged to $82,500 on Wednesday, setting a new high since January this year, but then fell back. Based on the all-time high of $126,080, Bitcoin’s cumulative drawdown is now more than 36%. CryptoQuant’s analysis, at the data level, characterizes this rally as a “bear market rally” rather than a structural turning point:

Realized profit volume on May 4: 146,000 BTC, the highest since December 10, 2024

Net realized profit over 30 days: back in positive territory (CryptoQuant calls it a “structural turning point,” but says it’s not enough to confirm a bull market)

Profit realized and given back so far: about 20,000 BTC—far below the 130,000 to 200,000 BTC levels typically needed for a bear-to-bull transition

Increase in unrealized profit: the largest since June 2025, with adjusted risk rising

CryptoQuant noted that in bear market rallies, a spike in realized profit at key resistance levels often signals the arrival of local tops or continued consolidation. However, with strong demand for perpetual futures in the near term and only a limited drop in spot demand, prices may still strengthen in the short run.

Overhang around the market: American Bitcoin posts an 82 million quarterly loss, with long liquidations of $269 million

Listed Bitcoin miner and asset management firm American Bitcoin (ABTC) saw its share price fall by more than 9% on Thursday. Earlier, it reported a net loss of nearly $82 million in the first quarter of 2026, a 37% increase from the net loss in the fourth quarter of 2025. Mining revenue fell 20% over the same period. The company was co-founded by Eric Trump. During this quarter, it increased its holdings by more than 1,600 BTC and cut mining costs from $46,900 in the fourth quarter to about $36,200.

Frequently Asked Questions

Why does the Strait of Hormuz clash directly affect Bitcoin prices?

The Strait of Hormuz is a key transit route for about 20% of the world’s oil. As tensions escalate, the tail risk of global energy supply disruption rises, triggering systematic selling of risk assets. In periods of high market uncertainty, Bitcoin is often treated as a risk asset rather than a safe-haven tool, and geopolitical pressure often translates directly into selling pressure in the crypto market.

How does CryptoQuant differentiate a “bear market rally” from a “bull market structural turning point”?

CryptoQuant’s key basis is the scale of profit being realized and then given back. The peak day of this rally had a realized profit volume of 146,000 BTC, far below the 130,000 to 200,000 BTC range typically associated with bull market turning points. This suggests the market-wide cost-basis structure has not fundamentally shifted, and most holders have not yet fully moved into a profitable position.

Where are Bitcoin’s key technical levels right now?

On the downside, $80,000 is the most critical psychological and technical support level. If it breaks down effectively, it will open further downside room. On the upside, the recent high of $82,500 is a near-term resistance level; only an effective breakout can help regain momentum. From a more macro perspective, Bitcoin is still down more than 36% from the all-time high of $126,080. Until the positioning structure improves, the sustainability of each rally should be assessed cautiously.