High Oil Prices May Curb Capital Inflows into Bitcoin: CryptoQuant

Brent crude oil prices above $100 per barrel create unfavorable conditions for new capital inflows into Bitcoin, according to CryptoQuant analyst Darkfost.

The expert linked sustained high oil prices to tensions in the Persian Gulf. He noted that rising energy costs increase production expenses and the price of goods and services. This intensifies inflationary pressure and raises the risk of a slowdown in the U.S. economy, thereby limiting the liquidity available to investors.

Darkfost pointed to the historical dynamics between oil and Bitcoin. When the benchmark Brent crude price consistently rose above its annual average, the leading cryptocurrency often lost momentum. Conversely, sharp declines in oil prices frequently coincided with Bitcoin’s recovery.

CryptoQuant acknowledged that these observations do not prove a direct correlation between Bitcoin’s price and oil costs. The primary influence on the cryptocurrency market remains the economic conditions accompanying energy price increases. In July, a temporary easing of pressure in the oil market allowed Bitcoin to strengthen, but oil prices subsequently rose significantly again.

“The current economic conditions are not particularly favorable for the inflow of new liquidity,” Darkfost noted.

Meanwhile, the expert did not rule out further growth for Bitcoin. In his assessment, the leading cryptocurrency could be supported by the redistribution of existing capital across financial markets, even without significant new inflows.

Previously, analysts from the platform Glassnode stated that the main obstacle to Bitcoin’s growth was investors who bought the asset at an average price of $87,700. Upon reaching this price level, they would likely seek to sell their coins to cut losses.