Bitcoin has effectively maintained its position above $71,000, despite indications of a slowing U.S. economy and ongoing geopolitical tensions. Fresh insights were shared by Kevin Hassett, a senior advisor at the White House, shedding light on America’s economic prospects, while the strategic Strait of Hormuz remains a focal point in U.S.-Iranian relations.
How is the White House Handling International Tensions?
Kevin Hassett spoke with optimism about the U.S. economy, predicting potential growth rates of 4 to 5 percent annually, despite current hostilities. Citing legislative power under the International Emergency Economic Powers Act, he suggested that President Trump could enact tough tariffs on countries arming Iran. Such measures aim to control inflation. Hassett also conveyed the administration’s stance on trade limits, monetary policies, and the oil market scenario.
“If countries assist our adversaries, Trump will respond—up to a 50% tariff is within his power. Interest rates ought to be lower, and the Federal Reserve’s balance sheet should shrink gradually. Ships are transiting the Strait of Hormuz, and if the strait fully reopens, I expect oil markets to normalize soon. Asia is under considerable strain due to dwindling oil supplies, whereas the US has felt much less impact. Once the Strait of Hormuz opens, gasoline prices should fall swiftly. We have consulted with allies to ensure secure supplies of US oil.”
Amidst these discussions, NATO’s Secretary General Mark Rutte has sought guarantees from its members to secure the passage through the Hormuz Strait. President Trump’s past comments about NATO create uncertainty about future cooperation.
EU’s head of foreign policy, Kaja Kallas, categorized the ongoing ceasefire with Iran as “fragile”, stressing the risks if conversations lose momentum. Her caution mirrors the European worry about the region’s growing volatility.
Reports from TASS have uncovered that, as part of the ceasefire terms, a daily limitation on ship movement through the Strait of Hormuz is in place, capping at 15 ships, in an effort to balance commercial activity and security.
“Our delegation will attend peace talks in Islamabad. The US must stop Israeli attacks on Lebanon. Any comprehensive peace must include Lebanon, and in the coming hours, we expect critical developments. Last night, Iran was prepared to respond to a ceasefire violation, but Pakistan intervened to de-escalate.”
Continuing caution is apparent among market participants, with Bitcoin stabilizing above $71,000, supported by a cautious optimism within both diplomatic and financial communities.
Do Market Challenges Pose a Threat to Bitcoin?
Bitcoin ETFs experienced $93 million in outflows recently, consistent with the selling behavior seen since early April. As the fragile ceasefire persists, further withdrawals might occur; however, Bitcoin remains steadfast above $71,000.
For Bitcoin to feasibly challenge the $75,800 milestone, it must conclusively close above $70,000 weekly. Currently, the cryptocurrency sustains itself at the lower boundary of its trading channel, yet struggles to overcome resistance at its peak.
Key factors crucial for a swift recovery include resolution of the conflict and Warsh’s anticipated appointment as Fed Chair, potentially ushering in an aggressive quantitative easing policy. Lacking these, Bitcoin risks sliding to sub-$60,000 values.
