Bitcoin traders are navigating with caution after the surge to $72,000 this week, analyst says.
US, Iran leaders set to meet in Pakistan on Saturday.
The fragile standstill in the Middle East has eased Bitcoin traders’ panic, but they’re not tearing up their hedges against a sharp drop just yet, according to Bybit chief market analyst Han Tan.
Even as it’s gotten cheaper for options traders to buy positions that protect them from another downturn, Tan notes that markets have not swung into full-blown optimism as traders weigh whether the US-Iran ceasefire can hold.
“Relief rallies across the risk complex have been limited by lingering doubts over a meaningful end to this Middle East conflict,” Tan said in a note shared with DL News. “The fragile ceasefire remains on shaky ground.”
His cautious assessment comes as Bitcoin powered 8% higher this week to trade around $72,000 after the US and Iran announced a conditional two-week truce that includes steps tied to reopening the Strait of Hormuz.
That narrow shipping lane carries about a fifth of global oil and liquefied natural gas. Its disruption during the five-week conflict rattled energy markets and turbocharged inflation worries, with investors fearing central banks will hike interest rates in response.
Bybit’s derivatives data suggest the rally carries more substance than a simple short squeeze.
Some $56 million in bearish positions were liquidated on the exchange’s Bitcoin perpetual contracts as prices jumped. But open interest rose alongside the rally, showing traders were adding fresh exposure. Funding rates remained stable, a sign of controlled risk-taking rather than euphoric leverage.
“Should this pause in the war shatter abruptly, risk assets are bound to give up much of their recent gains,” Tan said.
April has already seen $411 million flow into spot Bitcoin exchange-traded funds, DefiLlama data shows, underscoring renewed investor appetite as geopolitical tensions cool.
Truce prospects
The geopolitical backdrop affecting Bitcoin’s price remains complex and dynamic. That’s because central banks make interest rate decisions based on inflation data. High rates means less money in the financial system to support risky assets like cryptocurrencies.
“As long as the Strait of Hormuz remains practically shut, a temporary halt on military strikes does little to dilute inflation risks enough to alter the global monetary policy outlook,” Tan said.
On Saturday, US and Iranian officials are set to meet in Pakistan, with shipping access a central sticking point. President Donald Trump has demanded that Iran reopen the Strait of Hormuz and warned against levying fees on tankers.
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Traffic through the strategic corridor has largely stalled since the US and Israel attacked Iran on February 28. Ships remain clustered near Dubai and Khor Fakkan, a reminder of how quickly energy supply can become a geopolitical lever.
Meanwhile, Kuwait has reported drone attacks on vital facilities, accusing Iran and proxy groups of breaching the truce. Israel continues operations in Lebanon against Hezbollah, another potential flashpoint.
“Investors are adopting a wait-and-see approach.”
Crypto market movers
Bitcoin is up 1% over the past 24 hours, trading at $71,696.
Ethereum is up 0.1% over the past 24 hours at $2,182.
What we’re reading
Roman Storm defends Tornado Cash operation as judge weighs acquittal — DL News
Canton Network CEO hits back at ‘crypto ideologues’ who question his network’s blockchain credentials — DL News
Morgan Stanley’s MSBT Debuts as the Cheapest Spot Bitcoin ETF, Logs $34 Million on Day One — Unchained
Retail Is Quitting Crypto at the Worst Possible Time w/ Guy Wuollet — Milk Road
Russian Energy Ministry rubbishes claims it is poised to ban crypto mining in Moscow — DL News
Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com
