After retreating back to the $69,000 area during early U.S. morning hours Wednesday, bitcoin BTC$70,754.92 has quickly spiked to nearly $71,000.

Other crypto assets, including ether (ETH), solana (SOL) and XRP, saw the same sharp moves higher.

The gains appeared to come as crude oil quickly reversed most of its session's large gains, dropping $3 per barrel in a matter of minutes. At press time, WTI crude futures for April were at $85, up 2% for the day.

Crude's drop also benefited stocks, with the Nasdaq moving from a small decline to a gain of 0.5% in early U.S. trade.

Crypto-related shares were mixed, with Strategy (MSTR), Galaxy Digital (GLXY) and Bullish (BLSH) posting modest advances, while Coinbase (COIN) and eToro (ETOR) were slightly lower.

With the ongoing war against Iran, risk markets this week have been mostly ruled by oil's price action. Stocks and crypto plunged on Sunday evening as oil surged to $120, but then gained as oil quickly retreated.

Fresh inflation data

Wednesday's February CPI report was in line with economist forecasts, up 0.3% on a month-to-month basis, putting the 12-month inflation rate at 2.4%. Next month, however, could show a much different picture due to the outbreak of the U.S.-Iran war, posing the question of whether the Federal Reserve will respond to the temporary shock or take a more hawkish stance after being caught off guard during the last inflation cycle.

Stephen Coltman, head of macro at 21shares says the Fed's choice will be critical, noting that investors will be watching next week's Fed meeting closely for signs on how officials plan to react.

As for bitcoin, the rise in next month's data is likely "already baked in the cake," he said.