In April 2026, geopolitical tensions in the Strait of Hormuz entered a new critical phase. The U.S. Navy implemented a long-term maritime blockade, Iran’s Islamic Revolutionary Guard Corps claimed it has achieved “absolute control” over the strait, and Brent crude broke above $111. Even as traditional safe-haven assets saw inflows, the crypto market did not get the expected wave of safe-haven buying. According to Gate market data, as of April 29, 2026, BTC is quoted at $77,000, up 0.2% over the past 24 hours; ETH is temporarily quoted at $2,330, up 1.5% over the past 24 hours. Since the conflict began, Bitcoin has cumulatively fallen, and market sentiment indicators show it as neutral. This round of geopolitical crisis is reshaping global risk-asset pricing models, and Bitcoin’s value positioning is facing structural scrutiny.
Where is the blockade of the Strait of Hormuz at?
The Strait of Hormuz is the world’s most critical oil transportation corridor, with about one-fifth of global oil shipments passing through these waters. In April 2026, the U.S. Central Command announced a blockade of maritime traffic to and from Iranian ports, and more than 15 U.S. Navy vessels were deployed to support the operation. Israel continued to pledge its willingness to carry out “continuous and repeated strikes” on Iran’s nuclear facilities. In addition to declaring a national state of emergency, the U.S. further increased its forward military deployments in the region. U.S. officials said that during the blockade operation, orders had been issued to more than 30 ships to turn back or return to port, most of which are tankers.
Iran responded with a tough stance. On the 28th local time, a deputy commander of the Islamic Revolutionary Guard Corps Navy said Iran has achieved absolute control over the Strait of Hormuz and demanded that passing ships pay passage fees. Foreign-flagged vessels must comply with rules set by Iran when transiting, including using Persian-language communications. The Iranian deputy commander also emphasized that it would “never allow even a single liter of oil to flow out of the strait,” and claimed it is capable of dealing with any form of maritime blockade.
The negotiation window is narrowing. On April 28, the U.S. Congress will vote on the “War Powers Resolution,” deciding whether “Operation Epic Rage” will enter an unauthorized stage. The market is concerned that the Trump administration might continue pushing military actions in Congress without clear authorization. The extended ceasefire agreement failed to prevent the escalation of the conflict, and the core differences in demands are pushing the region onto a track of long-term confrontation.
Oil prices break $111 and the logic of stagflation trades
As of 10:00 a.m. on April 29, 2026, Brent crude oil was $111.86 per barrel, up 0.54%. WTI crude rose to above $100 per barrel. During the most intense stage of the blockade, spot Brent crude once touched $141.37 per barrel, the highest level since 2008.
The root cause of the surge in oil prices is a supply shock rather than demand pull. Once the duration of the blockade is extended, the global energy supply chain will face a substantive disruption. Goldman’s commodities research team raised its forecast for the average Brent crude price in Q4 2026 to $90, an increase of 12.5%. The firm also laid out several scenario simulations: if the strait’s exports resume normal operations in early May to mid-June, the Q4 average would be around below $80; if resumption is delayed until late July, the average would exceed $100; if Hormuz traffic cannot recover to above 70% for the long term, the average could approach $120.
This scenario triggers a classic “stagflation trade” logic—higher oil prices lift inflation expectations while constraining economic activity. HSBC noted that if the conflict continues, the Federal Reserve, the ECB, and the Bank of England may face pressure to tighten monetary policy. Under the Fed’s dual mandate of stabilizing both inflation and employment, the interest-rate outlook would become even more complicated. For the crypto market, this means the macro liquidity environment is tightening rather than easing—exactly the opposite of the conditions needed by safe-haven narratives.
Divergence in the performance of traditional safe-haven assets
In this round of the Hormuz crisis, a rare divergence appeared within traditional safe-haven assets. Spot gold fell below the integer $4,800 mark on April 21, then came under further pressure and dropped on April 23, losing the $4,700 level. On April 29, gold slid through $4,600, down about 10% from its higher levels. At the same time, the U.S. Dollar Index re-crossed the 100 level in early April, creating downward price pressure on both gold and crypto assets.
The root of this divergence lies in the market’s priority chase for U.S. dollar liquidity. Panic sparked by geopolitical events typically triggers indiscriminate cross-asset selling at the first moment. Investors choose to hold cash to obtain dollar liquidity rather than rushing into traditional safe-haven instruments. As the conflict moves into a long-term phase, the market’s judgment that U.S.-Iran military capabilities are vastly different and that the conflict is unlikely to spill over at a large scale quickly cools safe-haven demand, causing gold to rapidly lose support from its “uncertainty premium.”
Looking at a longer cycle, central bank gold-buying behavior remains the core pillar of gold pricing. The World Bank expects the average gold price in 2026 to be about $4,700, up about 37% year over year, but it may fall by about 7% in 2027. The short-term safe-haven funds stemming from the geopolitical conflict did not flow into gold at the scale expected, suggesting the market is more inclined to trade inflation-and-dollar-liquidity logic rather than directly betting on escalation and prolonged continuation of the conflict.
Real-world performance in crypto: Bitcoin safe-haven narrative tested
Bitcoin’s safe-haven narrative is one of the most core long-term logics in crypto markets in recent years, but during this round of the Hormuz crisis, the effectiveness of this narrative is being severely tested. According to Gate market data, BTC is currently at $77,000. It is up slightly 0.2% over the past 24 hours and trades within a narrow range below $77,000, failing to gain clear safe-haven buy support as the situation in the Middle East escalates. ETH is at $2,330, up 1.5% over the past 24 hours. Major altcoins—including Ethereum, XRP, Solana, and BNB—have all fallen over the past week, while Dogecoin is the only non-stablecoin in the top ten by market cap that recorded an increase, further pushing Bitcoin’s market dominance upward.
Total market capitalization for cryptocurrencies was about $2.7 trillion in April, but the rise in open interest in futures comes with a negative funding rate, and order-book liquidity remains below the level seen in 2025. On April 28, the overall crypto market fell 1.3%.
Judging by exchange net flows, over the 57 days since the conflict began at the end of February 2026, a total of 82,197 bitcoins have flowed out of centralized exchanges. This outflow does not equal an entry of off-exchange cash buying; it more reflects defensive actions by market participants in an environment full of uncertainty. Holders choose to move their assets to a safer environment rather than using them to increase leverage or actively add exposure.
Competitive capital attraction versus gold
The biggest change in this round of the conflict is that the correlation between Bitcoin and gold shifted from positive to negative. The two assets have formed a competitive capital attraction relationship. From a long-term perspective, Bitcoin’s volatility is about 3 to 5 times that of gold. This means that in periods of geopolitical uncertainty, holding Bitcoin carries a greater potential volatility risk. In a traditional safe-haven framework, low volatility is not an absolute advantage of gold, but it is one of the core reference metrics institutions use when assessing the effectiveness of safe-haven assets.
Institutional capital flows are more informative. Data show that U.S.-listed spot Bitcoin ETFs recorded the strongest monthly net inflow since October 2025 in April. Meanwhile, gold ETFs saw large net outflows. However, even with inflows at the ETF capital layer, the Bitcoin price still failed to break through key thresholds. This indicates that sell-side liquidity is sufficient and the market has not formed an overwhelming buy order flow capable of driving a trend reversal.
How rising oil prices drain liquidity from the crypto market
The macro logic in the Hormuz crisis transmission path is relatively clear: higher oil prices raise inflation expectations. The impact of the Middle East conflict on the global economy in 2026 is not about immediate economic data; it is about policy space narrowing again—energy prices staying elevated means most economies’ inflation will likely slow down at a slower pace.
If inflation pressure persists, markets will reassess the path for policy interest rates. Rising expectations for the risk-free rate will directly weigh on valuation benchmarks for duration-like assets, including crypto. At the same time, higher commodity prices attract capital back from the digital-asset market. In the initial stage, Bitcoin is highly sensitive to the macro environment. In the extreme early phase of geopolitical conflict, its liquidity is still constrained by macro liquidation pressure, so it tends to show high correlation with traditional risk assets.
What crypto markets face is a two-way squeezed liquidity environment: on one hand, risk appetite across major asset classes contracts significantly, prompting investors to reduce leverage and realize profits; on the other hand, spot buying power has not yet formed a scale sufficient to offset sell-side pressure. With the macro narrative becoming clearer, Bitcoin’s short-term direction will track changes in crude oil prices and inflation expectations more closely.
Crypto market outlook under the Hormuz deadlock
The duration of the Strait of Hormuz blockade is the key uncertainty determining where subsequent assets will go. If the blockade continues and oil prices stay high, macro liquidity conditions will keep tightening, and the structural logic weighing on the crypto market will be difficult to change. If signs of easing emerge in the conflict, markets may reprice expectations for policy easing. The speed and scale of capital returning to crypto will depend on macro sensitivity indicators—especially the magnitude of declines in the U.S. Dollar Index and inflation expectations.
Bitcoin’s price has already undergone a substantial adjustment in the first quarter, and passive selling pressure in the market is relatively limited. The macro shock is transitioning from an inflation shock driven by oil prices to a growth shock under energy constraints, and it may enter a phase of policy intervention. Investors need to watch for the macro narrative shifting from an inflation logic to a liquidity logic—and during the switching window, whether Bitcoin can be redefined by the market as a substitute for risk assets rather than an amplifier of risk assets.
From the medium to long term, concerns about geopolitical risk and the sustainability of sovereign debt are indeed pushing some investors to consider alternatives outside the traditional financial system. But this process takes time. In the short term, Bitcoin is still constrained by macro liquidity logic and cannot independently play out a distinct safe-haven行情. The direction of the Hormuz crisis will be a key observation ground for measuring Bitcoin’s asset attributes.
Summary
The blockade event in the Strait of Hormuz will very likely extend into a longer cycle. Markets have moved from a panic-trading phase in the early shock period to a narrative-formation and logic-competition phase. Bitcoin’s safe-haven narrative faces severe tests in this specific geopolitical conflict scenario: higher volatility makes it difficult for Bitcoin to be prioritized within the traditional safe-haven framework. Clear capital-flow data show that the commodities market has absorbed a substantial portion of risk-hedging demand. The subsequent trajectory of the crypto market depends on the interaction among oil prices, liquidity conditions, and policy expectations. No matter when the Strait of Hormuz reopens, this geopolitical pressure test will profoundly shape how investors perceive the value of cryptocurrencies.
FAQ
Q: How big is the impact of the Strait of Hormuz conflict on oil prices and global inflation?
A: The Strait of Hormuz accounts for about one-fifth of global oil transportation. The blockade has pushed Brent crude to break above $141 at one point; as of April 29, it is $111.86. Energy prices staying high means inflation in major economies is likely to cool more slowly, which may force central banks to reassess their interest-rate paths and thereby affect the global asset-pricing environment.
Q: Why hasn’t Bitcoin become a safe-haven asset as the market expected?
A: Bitcoin’s current pricing is dominated by macro liquidity logic rather than a purely safe-haven narrative. The Hormuz crisis raises oil prices → higher inflation expectations → higher policy interest-rate expectations → tighter liquidity → risk assets under pressure. Under this transmission chain, Bitcoin shows a high correlation with traditional risk assets, making it difficult to gain safe-haven buy support on its own.
Q: What trend has been seen in crypto market capital recently?
A: Since the conflict began, about 82,197 bitcoins have flowed out from centralized exchanges. Total market capitalization is about $2.7 trillion, but futures funding rates have remained negative and order-book liquidity is below the level seen in 2025. Panic caused by geopolitical tensions triggers cross-asset selling at the first moment.
Q: What changes have occurred in the safe-haven relative performance of Bitcoin versus gold in this round of the conflict?
A: The correlation between gold and Bitcoin has turned negative, and the two have formed a competitive capital attraction relationship. Some institutional capital has shifted from gold ETFs to Bitcoin ETFs, but the spot gold price is still above historical levels from the same period. Meanwhile, Bitcoin’s volatility is about 3 to 5 times that of gold. In a traditional safe-haven framework, when institutions assess holding costs, they tend to prefer assets with better stability.
Q: In the long run, does Bitcoin’s safe-haven attribute still hold?
A: Sovereign debt risk and diversification of the monetary system are driving some investors to consider alternative solutions involving digital assets. But in the current Hormuz-type geopolitical conflict scenario dominated by energy shocks, Bitcoin’s safe-haven narrative is still suppressed by liquidity logic. The evolution of asset attributes over the medium to long term needs to be validated through multiple sustained macro events.
