The Nikkei Shimbun reported on May 25 that the United States and Iran are discussing plans to open the Strait of Hormuz within about 30 days of a final agreement, extend a ceasefire in early April for 60 days, and hold nuclear talks during that period.
Bitcoin rescue settings have already been tested.
The U.S. military said it carried out “self-defense” strikes targeting missile launch sites and mine-laden ships in southern Iran, but said it was restraining itself while the ceasefire lasts.
The market situation will change with early morning updates. Although the extension of the ceasefire still reduces the immediate likelihood of wider escalation, the new attack near Hormuz signals that the risks have shifted from theoretical to practical.
Brent crude rebounded after falling on Monday, stocks traded mixed and Bitcoin remained fixed near the mid-$76,000 level as traders weighed diplomatic channels that remained open and dispute channels that remained open.
The extension of the ceasefire is positive for cryptocurrencies, as lower oil prices ease inflation fears, softer energy prices reduce demand for the dollar as a safe-haven asset, and improved risk sentiment creates space for Bitcoin.
What the market got was a rescue deal, and whether it holds will be determined by the Fed’s interest rate path and the macro cap that has capped Bitcoin since the battle began.
Now, the question is whether Bitcoin can sustain its rally while oil flows, Fed expectations, and military reports remain volatile.
| market reading | Immediate effect | Why Bitcoin is useful | why doesn’t it last |
|---|---|---|---|
| Brent falls below $100 | energy risk premium cool | Low oil prices ease inflation fears | Physical oil flow may still be interrupted |
| Stock prices soar | Improves risk appetite | BTC benefits from broad risk-on positioning | If negotiations stall, relief could be reversed. |
| BTC is trading near $77,500 | Cryptocurrency catches bailout bid | Panic over the danger of war fades | Breakout still tied to Fed path |
| 60-day ceasefire extension | Short-term escalation risk is reduced | Reduce immediate downside tail risk | New strikes show the countdown is already being tested |
New strikes turn ceasefire into Bitcoin live test
While the recent US attacks will not necessarily end the ceasefire framework, it will certainly change the way markets value it.
Centcom characterized the attack as defensive and said the U.S. military remained restrained during the ceasefire. This framework perpetuates the diplomatic footprint, but it also confirms that Hormuz remains an active military risk zone rather than a settled transport corridor.
This difference is important for Bitcoin. Headline low oil prices may support near-term risk bidding, but new military action near the Straits keeps the Fed wary of inflation risks, demand for safe assets, and trade.
The market could still rise based on the agreed framework. It is not yet possible to price sustained macro emissions until the strait opens, tanker traffic normalizes, and strike cycles stop disrupting the diplomatic process.
60 Days Live Headline Risk
The Nikkei report noted that Hormuz Island is scheduled to go to war within approximately 30 days of the final agreement, and that the extension of the ceasefire would initially create a two-month negotiation period.
This turn of events leaves the market exposed to at least 60 more days of raw headline risk related to access to Hormuz, tanker sailing, demining schedules, nuclear negotiations, contradictory public statements, and any escalation that could collapse before the window closes.
The Guardian reported that oil prices have fallen on hopes of a peace deal while the United States and Iran remain at odds over key issues such as Iran’s blockade of Hormuz, with an Iranian government spokesperson saying a deal was “not imminent” and adding that even if the strait were reopened, it could take months for normal oil flows to return.
Between now and the 60-day deadline, every oil headline will land in a market that has yet to price a complete end to the energy disruption. This is exactly the condition under which Bitcoin’s rise continues to be suppressed.
Bitcoin rose toward $82,000 in early May as WTI fell by about 6% on hopes for a peace deal, but fell to $76,500 on May 18, when President Trump warned Iran that “time is running out,” and risk assets weakened with Brent crude at one point above $112.
Extending the ceasefire could create another version of the original deal, a relief rally with no macro foundation to uphold.
Low oil prices and stable oil prices are different assets.
Conditions improve if Brent falls below $100, but the Federal Reserve sets energy prices differently than stock traders.
According to EIA data, 20.9 million barrels per day will pass through the Strait of Hormuz in the first half of 2025, representing about 20% of global oil consumption and a quarter of seaborne oil trade.
The report notes that around 20% of the world’s oil and LNG supplies typically pass through Hormuz, and pre-war shipping traffic averaged 125 to 140 ships a day, with a separate report saying only a few tankers had passed through in recent years and that even before the ceasefire extension traffic volumes were well below pre-war standards.
Diplomatic headlines could cause Brent to fall within hours, but it will take months to normalize tanker traffic through the recently closed strait, which is exactly the timeline the Fed will consider when determining whether the energy disruption is over.
Bitcoin can trade the fall in oil prices, but the Fed will have to factor in the entire oil shock, including the possibility that the 60-day period ends without a deal and Brent prices reversing May 25’s declines within days.
The asymmetry between what the market can price today and what the Fed needs to see before acting is at the heart of Bitcoin’s macro problem in this environment.
| Holmes index | Appearance/condition | Relevance to Bitcoin |
|---|---|---|
| Oil flow through Hormuz | 20.9 million barrels/day in the first half of 2025 | Showing why turmoil increases global inflation risks |
| Percentage of world oil consumption | Approximately 20% | Explaining why the Fed cannot ignore challenges |
| Share of offshore oil trade | Approximately 1/4 | Hormuz becomes a global market problem, not a local one |
| Normal transportation before the war | 125-140 passages per day | Set the baseline for “normalization” |
| recent traffic | Only a few tankers have passed recently. | Showing why low oil is still not equivalent to stable oil |
| Market impact | Brent could fall before flows normalize | BTC may rebound before macro uncertainties are resolved |
Fed’s frozen interest rate path
On May 11, Bank of America and Goldman Sachs postponed their expectations for a Fed rate cut, citing rising inflation as tied to energy prices and the resilience of the labor market. Markets had previously priced in two rate cuts in 2026 before the battle began.
BofA now expects the Fed to keep rates unchanged for the remainder of 2026, while Goldman has postponed the first expected rate cut to December 2026 and the second to March 2027.
The banks said rising energy costs are impacting transportation, manufacturing and consumer prices, giving the Fed less confidence to declare inflation back on track.
On May 20, Fed officials became increasingly concerned about inflation related to the Iran war, and more officials were open to the possibility of needing to raise interest rates.
This move is directly reflected in market pricing, with traders seeing a 40% chance of a 25 basis point rate hike in December 2026, and markets fully pricing in a 25 basis point rate hike by January 2027, compared to the two rate cuts expected in 2026 before the fighting began.
These probabilities will remain until physical oil flows normalize and the risk of escalation falls to a level that policymakers can safely ignore, a condition that cannot be guaranteed over a two-month negotiation period.
The extension will give the Fed more time to watch as there is no new information to justify the move. For Bitcoin, a Fed that cannot lower interest rates is also a Fed that leaves the real interest rate environment harsher than the crypto market can comfortably sustain.
Bitcoin’s Two Ways Out of the 60 Day Window
The bull case will materialize if a signed agreement occurs within the 60-day grace period, demining begins, traffic in Hormuz normalizes, and nuclear negotiations permanently reduce headline risk. At that point, Brent crude oil prices are likely to fall based on physical supply data confirmed by actual tanker flows.
Inflation risk premiums fade, Fed rate hike pricing eases, and Bitcoin gains a cleaner risk-on runway. The 40% probability of a December rate hike that traders had priced in on May 25th has shrunk, and Bitcoin could attempt a breakout towards confirmed macro support.
| path | what needs to happen | oil impact | Fed influence | Impact of Bitcoin |
|---|---|---|---|---|
| For the bull: relief turns into resolution | Signed deal, demining, normalization of traffic in Hormuz, nuclear negotiations reduce headline risks | Brent falls on confirmed physical flow data | Easing price increases. Cuts make pricing easier later on. | BTC gains a cleaner risk-on runway and could attempt a stronger breakout |
| For bears: a truce becomes a waiting room. | Negotiations drag on, tanker traffic slowly recovers, contradictory statements continue and oil prices remain elevated | Crude oil instability continues into summer | The Fed remains frozen. Chance of rate hike remaining or rising | BTC could rise in headlines, but breakout remains limited |
| Shock case: window glass breaks | Ceasefire failed or Hormuz remains restricted | Brent repeats May 25 drop or spike | Market moves away from interest rate cuts and closer to interest rate hikes | BTC faces new macro drawdown |
If tanker traffic normalizes over months rather than weeks, if Iran and the United States continue to issue conflicting statements, and if oil reserves rise throughout the summer, the bear incident could continue without a formal breakdown in the ceasefire.
The Fed remains on hold, and pricing in a rate cut becomes more difficult with each passing week, with the 40% chance traders assigned on May 25 of a rate hike in December rising further.
While Bitcoin could rebound with every positive headline, the macro ceiling of oil volatility, inflation risk premium, and Fed uncertainty remains in place, and the 60-day extension accomplishes exactly what its structure implies. In other words, it is a new waiting period until a macro solution is reached that the market has not yet priced in.
(Tag translation) Bitcoin
