Bitcoin started the week higher after Donald Trump announced Project Freedom, a plan to escort civilian ships through the Strait of Hormuz. BTC rose more than 2% and traded near $80,300 after the announcement. Currently it is trading at $79,707 as per CoinMarketCap data.
Key Takeaways
- Bitcoin moved back above $80,000 after Trump announced Project Freedom.
- Almost $300 million in crypto short positions were liquidated as prices climbed.
- Coinbase Institutional and Glassnode found that 75% of institutional investors see Bitcoin as undervalued.
Oil Fears Ease And Bitcoin Buyers Return
Bitcoin had a rough year, but buyers reacted fast after Trump talked about safer shipping through the Strait of Hormuz. Oil dropped back below $100, and Trump also described diplomatic talks with Iran as “very positive.”
For Bitcoin, that helped because oil shocks can scare investors. Higher oil prices can feed inflation, and inflation can make central banks less likely to cut interest rates. When that happens, risk assets like Bitcoin often struggle.
🇺🇸🇮🇷 CENTCOM just confirmed: Project Freedom begins today, May 4.
US Central Command forces are moving to restore freedom of navigation through the Strait of Hormuz.
This is the most direct US challenge to Iran's control of the strait since the war began. Oil is already below… https://t.co/nVcobPmxu3 pic.twitter.com/WahsH3loyu
— Mario Nawfal (@MarioNawfal) May 3, 2026
Project Freedom still carries risk. Some investors worry that escorting civilian ships near Iran could raise tensions again. Yet markets treated the announcement as a sign that the United States wants to keep shipping lanes open and limit damage from the conflict.
At the same time, traders who bet against Bitcoin got squeezed. Nearly $300 million in short positions across the crypto market closed by force after prices climbed.
A short trade works like a bet on a lower price. A trader borrows Bitcoin, sells it, and hopes to buy it back cheaper later. When the price rises instead, that trader may need to buy Bitcoin back quickly to close the position. When many traders do that together, the buying can lift the price even faster.
Big Investors Still See Cheaper Bitcoin
Short liquidations helped the quick jump, but larger investors may explain why Bitcoin found support near lower levels.
A Coinbase Institutional and Glassnode survey, called Charting Crypto Q2 2026, asked 91 global investors about the crypto market between March 16 and April 7. The group included 29 institutions and 62 private investors.
Among institutions, 75% said Bitcoin looked undervalued at current prices. Among private investors, 61% gave the same answer. Only 7% of institutions and 11% of private investors said BTC looked too expensive.
That view comes after a steep drop. Bitcoin reached more than $126,000 in early October, then fell by more than 50%. After recent gains, BTC still trades about 40% below that peak.
The survey also showed a change in Bitcoin dominance expectations. Bitcoin dominance means the share of the total crypto market held by BTC. It now sits around 58%.
In December, 40% of institutions expected Bitcoin dominance to rise. Now only 25% expect a higher share. A larger group, 54%, expects Bitcoin dominance to stay near current levels, while 21% expects a drop. That would give altcoins like Ethereum more room.
Investors also sound less gloomy than before. Around 43% of institutions now think the bear market sits near its final phase, compared with only 5% in December. Among private investors, that figure rose from 15% to 21%.
Still, Coinbase kept a neutral view for the quarter. The firm pointed to Middle East conflict and oil prices as main reasons for caution. A Hormuz disruption can create a difficult mix of weak growth and rising inflation, often called stagflation.
Bitcoin still follows its four-year cycle rather neatly as well. Under that pattern, the lowest price would come in the fourth quarter. Of course, patterns can break. But first, BTC needs to win back important technical levels and hold them.