Key takeaways:
US government bailout plans and currency swap lines with the UAE are easing global liquidity fears and lowering credit crisis risks.
Record Bitcoin ETF inflows and rising BTC miner profits suggest strong bullish momentum despite the ongoing war in Iran.
The total cryptocurrency market capitalization surged to an 11-week high on Wednesday as Bitcoin (BTC) climbed to $79,000 and Ether (ETH) reached $2,400. The bullish momentum occurred as investors grew more confident that immediate US recession risks were fading, despite sustained high oil prices resulting from the war in Iran.
Traders are now weighing whether Bitcoin and Ether are destined for further gains or if a short-term correction is imminent given that economic recession risks persist.
Nasdaq 100 futures (left) vs. Total crypto market capitalization, USD (right). Source: TradingView
The tech-heavy Nasdaq-100 index reached a record high on Wednesday as traders awaited Tesla (TSLA US) quarterly earnings. Brent crude prices rose 9% over two days after reports indicated Iran targeted two vessels in the Strait of Hormuz. Elevated energy costs increase the likelihood of economic stimulus, providing a temporary buffer for risk assets.
US liquidity plans and Bitcoin ETF inflows may offset recession fears
US President Donald Trump reportedly stated during a CNBC interview that “the federal government should help” Spirit Airlines, a budget carrier that has experienced bankruptcy twice since 2025. The Trump administration previously provided capital to chipmaker Intel (INTC US), utility Southern Company (SO US) and defense contractor L3Harris (LHX US).
Direct US government intervention in private firms and the US Treasury signals that credit lines for allies have eased liquidity concerns. US Treasury Secretary Scott Bessent noted Wednesday that both the US and the United Arab Emirates would benefit from a currency swap line intended to “maintain order in the dollar funding markets.”
US allies are facing pressure to sell US bonds to raise dollars for local defense, imports and liquidity amid the collapse of oil revenue and disruptions in the Strait of…
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