US President Donald Trump recently announced that a peace deal to end the ongoing conflict between the United States and Iran is slated for signing this Sunday. The proposed agreement, which would immediately reopen the critical Strait of Hormuz, is already making waves across global financial sectors. For the cryptocurrency market, which has faced significant pressure during the naval blockade, this geopolitical shift could be the exact catalyst needed to drive liquidity back into risk-on assets like Bitcoin.
Conflicting Timelines on the US-Iran Ceasefire Agreement
Despite Trump’s optimistic announcement on Truth Social claiming the deal would be signed on Sunday and instantly open the Strait of Hormuz, officials in Tehran have offered a more cautious outlook. Iranian Foreign Ministry spokesperson Esmaeil Baghaei clarified to state media that while an agreement is expected in the coming days, the exact date of the memorandum’s signing remains unconfirmed and will not happen on Sunday.
However, Pakistan, acting as the primary mediator in these high-stakes negotiations, seems to align closer to the US timeline. Pakistani Prime Minister Shehbaz Sharif noted on the social media platform X that the two nations are closer to peace than ever before, signaling that an electronic signing could occur within 24 hours, followed by technical discussions next week. If finalized, the memorandum of understanding is expected to extend the current US-Iran ceasefire for 60 days and lift the naval blockade that has severely restricted the global supply of oil and liquefied natural gas.
How Reopening the Strait of Hormuz Could Trigger a Crypto Rally
The ongoing naval blockade has choked off roughly 20% of the world’s energy supply, causing global asset prices to spike and creating a macroeconomic shock that has weighed heavily on digital assets for months. According to CoinShares head of research James Butterfill, this geopolitical uncertainty and its broader impact on interest rate outlooks have been the primary drivers behind recent crypto market struggles. This tension is evident in recent market data, with spot Bitcoin exchange-traded funds (ETFs) experiencing their fifth consecutive week of net outflows, bleeding nearly $316 million in the week leading up to the announcement.
A confirmed peace deal could rapidly reverse this cautious sentiment. Prominent crypto analyst Michaël van de Poppe anticipates that resolving the conflict will prompt a significant surge in Bitcoin alongside a return to positive ETF inflows. With the recent completion of the SpaceX IPO, van de Poppe suggests that fresh market liquidity will actively seek new opportunities, and risk-on assets like cryptocurrencies are prime targets for that capital. As news of the potential deal broke, Bitcoin already began showing signs of recovery, trading around $64,491 and posting a modest gain as investor sentiment shifted back toward growth.
