Author: Huobi Growth Academy
summary
In April 2026, the global crypto market exhibited structural divergence and a phase of recovery amidst the interplay of three intertwined variables. The temporary ceasefire agreement between the US and Iran, which took effect on April 9th, immediately revealed serious disagreements—the US declared the Strait of Hormuz "fully open," while Iran limited daily passage to approximately 10 vessels (less than 8% of pre-war levels), and negotiations broke down on April 12th, causing market volatility. On April 21st, Iran announced its renewed participation in negotiations, and Bitcoin rebounded above $76,000, but the ceasefire deadline approached again on April 22nd. Regarding the Federal Reserve, Trump threatened to dismiss Powell, Kevin Warsh's nomination hearings were held, and there were clear divisions between hawks and doves within the committee. Meanwhile, the Morgan Stanley Spot Bitcoin ETF (MSBT) was launched, attracting over $100 million in its first week with a fee rate of only 0.14%, marking Wall Street's formal inclusion of Bitcoin in its standardized product system. Under the combined influence of these three variables, Bitcoin demonstrated unique resilience in April. However, the difficult technical landscape and the unresolved geopolitical game make it difficult for the market to form a consensus on direction in the short term.
I. Ceasefire Negotiations: The Strait of Hormuz – Open or Closed
In April 2026, the fate of the Strait of Hormuz once again became a key variable affecting global risk assets. On April 9, the two-week temporary ceasefire agreement between the US and Iran officially took effect, and global markets reacted optimistically immediately: Brent crude oil plummeted from its highs, Bitcoin briefly broke through $71,000, and $427 million worth of cryptocurrency short positions were forcibly liquidated within 48 hours. However, the "honeymoon period" of the ceasefire lasted only a few hours.
The ceasefire agreement contains fundamental disagreements. The Trump administration announced a "full opening" of the Strait of Hormuz; Iran, however, only promised that ships could pass through "in coordination with the Iranian armed forces," limiting daily transit to about 10 vessels, compared to over 130 vessels per day before the war, representing less than 8% of the previous volume. Hundreds of ships remain stranded in the region, effectively trapped.
More noteworthy is Iran's move to impose "tolls" on passing vessels, at a rate of approximately $1 per barrel of oil, requiring payment in cryptocurrency. This move not only reshapes the global energy transportation cost structure but also signifies that Bitcoin is being embedded into the international energy trade settlement system in an unprecedented way. Terry Haynes, an analyst at Pangea Policy, succinctly commented: "Whether an agreement is reached or not, this will become the new normal."
On April 12, the third round of negotiations in Islamabad broke down, with both the US and Iran walking away. As a result, Bitcoin fell to around $69,000, and the total market capitalization of the cryptocurrency market evaporated by over $100 billion in a single day. However, the situation reversed again on April 17, with Bitcoin surging to a high of $78,000. Nearly 170,000 people were liquidated during the violent fluctuations, with total liquidations exceeding $700 million, fully exposing the high leverage and volatility characteristics of the current market.
On April 21, Iran announced it would send representatives to the second round of talks, causing Bitcoin to rebound above $76,000. However, with the ceasefire deadline approaching on April 22, both the US and Iran issued strong signals: an Iranian Defense Ministry spokesperson emphasized that the reopening was "temporary"; US Central Command Commander Cooper stated that the blockade would "continue until the president orders its lifting." US stocks closed sharply lower, with the Dow Jones Industrial Average falling more than 290 points, putting pressure on the cryptocurrency market. Whether the ceasefire agreement can be extended will be the most critical external variable for the cryptocurrency market in the coming weeks.
II. The Federal Reserve's Leadership Change Crisis: Policy Independence Encounters a "Trump Moment"
In April 2026, the Federal Reserve will be experiencing one of the most complex periods of political pressure in modern history. On April 15, Trump made it clear that if Powell does not resign voluntarily after his term expires in May, he will "have to" remove him from office. This statement directly impacted market expectations of the Fed's policy independence, causing the dollar index to weaken in the short term and gold to rise above $4,800 per ounce at one point.
Kevin Warsh's nomination hearing for Federal Reserve Chair was held on April 21. Warsh, who holds over $100 million in fund investments, is considered a more likely candidate to align with Trump's calls for interest rate cuts. Senator Tillis announced he would block the nomination on the condition of dropping the criminal investigation against Powell, casting a political shadow over the entire succession process.
The Federal Reserve is also clearly divided on policy. Hawkish Daly warned that a rate hike could be ruled out if the Middle East energy shock further fuels inflation; Chicago Fed President Goolsby believes the timeline for rate cuts may be delayed until 2027; dovish Governor Milan believes there should be three to four rate cuts this year, stating "there is no reason to wait any longer." Neutral Governor Williams stated that current policy is "well-positioned" and there is no need for hasty adjustments. The Fed's April Beige Book showed that most districts maintained slight to moderate economic growth, but energy and fuel costs rose "significantly" in all 12 districts, and businesses have generally reduced hiring and capital spending.
Regarding market pricing, a Bank of America survey shows that 58% of institutional investors still expect the Federal Reserve to cut interest rates within 12 months; CME FedWatch data shows that the probability of a rate cut in September has rebounded from 40% at the end of March to around 55%. For crypto assets, the tension between "expected rate cuts but actual tightening" means that the narrative of liquidity recovery still exists, but its implementation will be delayed more than previously anticipated. The uncertainty surrounding the change of leadership at the Federal Reserve will make this process highly unpredictable.
III. Accelerated Institutionalization: The Historic Significance of Morgan Stanley MSBT
On April 8th, Morgan Stanley's spot Bitcoin ETF (MSBT) officially listed on the NYSE Arca, becoming the first Bitcoin spot ETF product independently issued by a major commercial bank in the United States, with a fee rate of only 0.14%, setting a new low for mainstream Bitcoin ETFs. This event signifies that the traditional power core of Wall Street has officially incorporated Bitcoin into its standardized product system.
MSBT saw $34 million in inflows on its first day of trading, ranking among the top 1% of ETF launches in history according to Bloomberg ETF analysts. As of April 17, MSBT had achieved net inflows for eight consecutive trading days, accumulating over $133 million, with an average daily net inflow of approximately $16.6 million. Morgan Stanley has approximately 16,000 wealth management advisors, covering a client base with $9.3 trillion in assets under management. Bloomberg analysts predict that MSBT's first-year AUM will reach $5 billion.
MSBT's success is the product of the convergence of multiple structural forces. BlackRock's IBIT, since its listing in January 2024, has attracted over $100 billion in assets under management, demonstrating the real and substantial demand for institutional-grade Bitcoin ETFs and providing market validation for later entrants. Morgan Stanley possesses a mature wealth management distribution network, essentially opening up a completely new distribution channel distinct from BlackRock's institutional clients. From a regulatory perspective, the trend of the SEC approving multiple bank-affiliated institutions to participate in the Bitcoin ETF market is becoming increasingly clear, significantly increasing the probability of similar products from major banks such as Goldman Sachs and Citigroup following suit.
On-chain data also confirms the accelerated institutionalization process. Large wallet addresses holding more than 10,000 Bitcoins saw net inflows in early April, marking the second time this has happened in 2026; Bitcoin market funding rates remained flat to slightly negative, confirming that the current market is driven by spot trading rather than leveraged speculation, conveying typical institutional-dominated market characteristics of "large holders accumulating on dips while retail investors remain cautious."
However, Ethereum's situation contrasts sharply with Bitcoin's. Ethereum spot ETFs continued to record net outflows in April, with BlackRock's ETHA experiencing a single-week outflow of nearly $70 million, while the price fluctuated between $2,100 and $2,400. According to CryptoQuant data, over 75% of the Ethereum held on Binance is leveraged. This high leverage coupled with capital outflows makes Ethereum more vulnerable to cascading liquidations when market sentiment deteriorates. The continued divergence in institutional fund flows between Bitcoin and Ethereum reflects two drastically different asset positioning paths—the former is becoming "digital gold," while the latter is still in the long process of building "digital asset technology infrastructure."
IV. Bitcoin's "Dual-Driven" Pricing: The Overlapping Identity of Risk Asset and Scarce Asset
The market movements in April provided a valuable stress test for understanding the asset nature of Bitcoin. When the US-Iran negotiations broke down on April 12, Bitcoin fell in tandem with the Nasdaq; when news of a ceasefire broke on April 9, Bitcoin rebounded along with the decline in crude oil prices. This series of highly correlated price movements further confirms that Bitcoin at this stage is still more like a "risk asset" than a mature "safe-haven asset." However, looking at a longer monthly timeframe, Bitcoin's performance compared to traditional risk assets showed a remarkable divergence in resilience.
By mid-April, Bitcoin had risen by approximately 3% to 5% for the month, while the Nasdaq Composite Index fell by more than 3% and the S&P 500 also performed weakly. Amid this round of geopolitical shocks, gold prices fell sharply from a high of $4,800, dropping below $4,780 per ounce, while Bitcoin, despite experiencing several significant fluctuations, remained above its initial quarterly level. This comparison illustrates that although Bitcoin has not yet become a consensus safe-haven asset among institutions, its supply and demand structure has formed a unique bottom support, distinct from traditional risk assets, due to the deepening institutionalization of ETFs.
From a technical perspective, Bitcoin exhibited typical characteristics of "range-bound trading + directional testing" in April. The core trading range of $62,000 to $75,000 has persisted for approximately two months, with $62,000 representing a support level tested twice since February; while $75,000 represents the upper limit of the range, which has repeatedly suppressed upward movements. Looking at the moving average structure, the 50-day and 200-day EMAs formed a death cross in November 2025, indicating that the medium-term trend remains in a structurally downward channel. However, Bitcoin volatility has fallen to a two-month low since April. This low volatility often foreshadows greater directional volatility, and investors should be prepared for both possibilities.
From a broader perspective, Iran's Bitcoin transit fee policy has profound structural implications. Requiring payment for passage through the Strait of Hormuz in cryptocurrency effectively embeds Bitcoin into the global commodity trade settlement system, albeit on a limited scale. If this precedent continues, its long-term impact on Bitcoin's evolution from a "speculative asset" to a "settlement tool" could exceed the influence of any single institutional ETF product.
In summary, Bitcoin's current pricing logic has evolved from being purely macro-driven to a composite pricing system dominated by three factors: macro liquidity expectations, institutional supply and demand structure, and geopolitical risk premium. Short-term prices are highly sensitive to macro events, but the medium-term bottom is being continuously raised by institutional accumulation. The halving effect is still slowly unfolding, and the post-halving supply compression coupled with increasing demand through ETF channels constitutes a "hidden floor" in Bitcoin's macro pricing logic.
V. Future Prospects: Three-Scenario Analysis and Key Observation Nodes
Considering the three main factors of geopolitics, monetary policy, and institutional fund flows, the current crypto market may evolve along the following three scenario paths.
Scenario 1: Ceasefire Extended and Fed Leadership Change Completed, Bitcoin Challenges $80,000. If the ceasefire agreement is successfully renewed on April 22, US-Iran negotiations will enter a formal framework, and traffic in the Strait of Hormuz will gradually recover to over 50% of pre-war levels. If Warsh is successfully confirmed by the Senate and releases dovish signals, market expectations for the number of rate cuts in 2026 will be revised from "0 to 1 times" to "2 to 3 times," reactivating the narrative of loose liquidity. In this scenario, Bitcoin is expected to test the psychological barrier of $80,000 in the short term, with JPMorgan Chase even giving a long-term target range of $170,000 to $240,000 based on Fibonacci extensions. Key indicators for this scenario include: the announcement date of the ceasefire renewal, the Senate vote on Warsh, and weekly fund flow data from BlackRock IBIT and Morgan Stanley MSBT.
Scenario 2: Ceasefire breaks down, tensions escalate again, and Bitcoin retreats to the $65,000 range. If the two sides fail to reach an agreement on an extension after the ceasefire expires, Iran announces the restoration of the Strait of Hormuz blockade, oil prices return to the $110-$120 range, and global inflation expectations rise sharply. The Federal Reserve is forced to send a stronger signal of maintaining high interest rates, and the market fully prices in a 2026 rate cut. Bitcoin may fall below the $70,000 support level and test the $65,000-$62,000 range. Passive liquidation of highly leveraged positions could trigger a short-term liquidity crisis. Key factors to watch in this scenario include: the number of oil tankers departing from Dubai, global tanker freight rates, and whether US gasoline retail prices break the key psychological level of $4 per gallon again.
Scenario 3: Geopolitical tensions ease, but stagflation persists, keeping Bitcoin range-bound. If the ceasefire continues but core inflation remains stubborn, causing the Federal Reserve to postpone its first rate cut until September or even later, liquidity constraints will be offset by improved risk appetite resulting from geopolitical easing. Bitcoin's most likely trajectory is to maintain a wide trading range between $62,000 and $78,000, with volatility gradually narrowing as it awaits the next catalyst. For institutional investors with medium- to long-term investment horizons, this scenario presents a relatively comfortable entry window: the lower end of the range offers a clear entry opportunity, while continued inflows through ETFs provide buying support at the upper end.
Beyond the three scenarios outlined, the subsequent evolution of Iran's Bitcoin toll policy is a structural variable worthy of separate attention. If other sanctioned countries emulate this policy, it could create unexpected use cases for Bitcoin in real-world global trade settlements, potentially spurring a "Bitcoin settlement demand" market independent of traditional macroeconomic narratives. This potential variable has not yet been fully factored into mainstream pricing logic and warrants continued monitoring.
VI. Conclusion: Standing at the intersection of institutionalization and geopolitical competition
In April 2026, the crypto market stands at a historic crossroads. The entry of institutional products such as Morgan Stanley MSBT signifies a profound evolution in Bitcoin's fundamental holder structure, moving from "crypto-native" to "global mainstream," providing unprecedented price support and legitimacy endorsement. However, at the same time, the fragility of the US-Iran ceasefire agreement and the political pressure on the Federal Reserve's policy independence create a highly uncertain short-term macroeconomic environment, where any single event could trigger dramatic market fluctuations.
The key to understanding the crypto market at this stage lies in distinguishing between "noise" and "signals." The back-and-forth of geopolitical events, the hawkish and dovish debates among Federal Reserve officials, and large-scale daily liquidation data are essentially noise—they affect prices in the short term, but cannot change the medium-term trend direction pointed to by the structural signal of accelerated institutionalization. Institutional investors are voting with their actions: regardless of whether the ceasefire agreement continues or whether Powell remains in office, the net inflow data for spot Bitcoin ETFs has remained highly stable, indicating that the long-term allocation logic of institutions towards Bitcoin does not depend on the specific outcome of any single macroeconomic variable.
For investors seeking certainty in this complex environment, the most important discipline is to avoid using short-term geopolitical events as the sole basis for position sizing, and instead to comprehensively evaluate them within a broader framework of "institutional fund flows + macro liquidity expectations." Bitcoin's long-term support around $62,000 has a solid fundamental basis, while a break above $80,000 requires positive catalysts from geopolitical, monetary, and institutional factors. Until all three conditions are met simultaneously, patience and position flexibility will be the core strategy for navigating the current volatility. The geopolitical fog will eventually dissipate, institutional activity will not cease, and Bitcoin's historic leap is becoming a reality step by step at a visible pace.
