The U.S. government's bailout plans and currency swap lines with the United Arab Emirates are alleviating global liquidity fears and reducing credit crisis risks. According to Cointelegraph, record inflows into Bitcoin exchange-traded funds (ETFs) and increasing profits for Bitcoin miners indicate robust bullish momentum, despite the ongoing conflict in Iran.
On Wednesday, the total cryptocurrency market capitalization reached an 11-week high as Bitcoin surged to $79,000 and Ether climbed to $2,400. This bullish trend emerged as investors gained confidence that immediate U.S. recession risks were diminishing, despite the persistent high oil prices due to the war in Iran. Traders are now considering whether Bitcoin and Ether will continue to rise or if a short-term correction is likely, given the ongoing economic recession risks.
The Nasdaq-100 index, known for its tech-heavy composition, hit a record high on Wednesday as traders anticipated Tesla's quarterly earnings. Meanwhile, Brent crude prices increased by 9% over two days following reports of Iran targeting two vessels in the Strait of Hormuz. Elevated energy costs are increasing the likelihood of economic stimulus, providing a temporary buffer for risk assets.
U.S. President Donald Trump reportedly mentioned in a CNBC interview that the federal government should assist Spirit Airlines, a budget carrier that has faced bankruptcy twice since 2025. The Trump administration has previously provided capital to companies like Intel, Southern Company, and L3Harris. Direct intervention by the U.S. government in private firms and the U.S. Treasury indicates that credit lines for allies have eased liquidity concerns. U.S. Treasury Secretary Scott Bessent noted that both the U.S. and the UAE would benefit from a currency swap line intended to maintain order in the dollar funding markets.
U.S. allies are under pressure to sell U.S. bonds to raise dollars for local defense, imports, and liquidity amid the collapse of oil revenue and disruptions in the Strait of Hormuz. Potential currency swaps ease these dollar shortages, preventing a spike in U.S. Treasury yields, which results in lower borrowing costs and a reduced risk of an immediate credit crisis.
Six consecutive days of inflows into U.S.-listed Bitcoin ETFs, totaling $1.54 billion, have likely boosted sentiment. The successful launch of the Morgan Stanley Bitcoin Trust, which reached $145 million in total net assets in under three weeks, has improved Bitcoin's risk perception despite global socio-economic uncertainty.
As Bitcoin's price approached $79,000, miner profitability reached its highest level since January, according to Luxor's Hashprice Index. Miners have recently gained attention as firms sold significant Bitcoin holdings to fund investments in data centers and AI infrastructure. While higher profitability does not guarantee reduced selling pressure from miners, the bullish momentum creates an incentive to accumulate.
Ultimately, a short-term correlation with U.S. stock markets continues to influence cryptocurrency trends; therefore, the war in Iran and tech earnings remain decisive for trader sentiment. As the U.S. government signals that stimulus measures will be used to secure liquidity and address credit concerns, Bitcoin and Ether appear primed to sustain their upward momentum.
Joy
Weiliang
Miyuki
Brian
Alex