Bitcoin traded as low as $66,000 during Monday morning trading after US President Trump claimed that the United States had negotiated a peace deal with Iran that would reopen the Strait of Hormuz.
“The agreement with the Islamic Republic of Iran is now finalized. Congratulations to everyone!” Trump sent on his Truth Social platform tardy Sunday evening.
“I hereby fully authorize the free opening of the Strait of Hormuz and at the same time authorize the immediate removal of the blockade of the United States Navy,” Trump said. “Ships of the World, start your engines. Let the oil flow!”
“With the opening of the Strait after the signing of the agreement on Friday […] Oil will flow on both sides again, for the region and the world! He he said in a separate post.
Source: Donald Trump
Trump has claimed dozens of times over the past two months that an agreement to end the war is imminent, and cryptocurrency markets have been trading on news of the Iran war since it began in February with U.S.-Israeli strikes.
According to TradingView, markets reacted positively to Trump’s latest claim, with the price of bitcoin (BTC) on Coinbase reaching $65,881 on Monday morning. This is the highest turnover in this asset in the last 12 days, and since June 3 it has not exceeded $66,000.
Andri Fauzan Adziima, head of research at Bitrue Research Institute, told Cointelegraph that the potential deal “removes the main geopolitical risk premium, resulting in a clear change in risk as uncertainty decreases.”
“Bitcoin has breached the $65,000 mark, driven by traders returning to cryptocurrencies amid lower oil pressure and a broader narrative of stability under a pro-crypto government,” he added, but cautioned that there could be “last-minute issues with signing a deal.”
Details of the U.S.-Iran deal were not immediately available and it will not be implemented until Iran signs it, which is expected to happen Friday via Pakistan, Associated Press reported.
Related: Trump claims that a peace agreement with Iran will be signed on Sunday, which is contrary to Tehran
Iran’s deputy foreign minister, Kazem Gharibabadi, confirmed the agreement on state television, while the secretariat of Iran’s Supreme National Security Council said the war on all fronts “will end immediately and permanently, beginning tonight” and the U.S. blockade “will end immediately and completely.”
Bitcoin has been gradually gaining ground since it briefly dropped below $60,000 on June 6; however, it remains 48% below its high of over $126,000 in October.
The broader cryptocurrency market also gained 2% of total capitalization on the day, with several altcoins including Hyperliquid (HYPE), Zcash (ZEC) and Near Protocol (NEAR) performing better, with some with double-digit percentage gains.
There were also changes in crude oil prices, with WTI Crude falling 5% to its lowest level since early March at just over $80 a barrel, while Brent Crude mirrored the move, falling 4.6% to $83.30.
There may be more variability
Wednesday could enhance volatility in cryptocurrency markets as the Federal Reserve is set to make a decision on interest rates, the first under recent chairman Kevin Warsh.
The recent central bank governor seems more open to cuts, but rising inflation, which has again exceeded 4%, strengthens the case for rate increases.
Currently the CME Fed Watch tool predicts the probability that rates will remain unchanged at 3.5% to 3.75% is 96.6%
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