How the Crypto Market Reacted to Trump’s Israel-Iran Ceasefire Declaration
Bitcoin, Ethereum, and altcoins surge as traders bet on easing geopolitical risk.
The crypto market came roaring back to life Tuesday after U.S. President Donald Trump declared that Israel and Iran had agreed to a ceasefire, signaling a potential end to nearly two weeks of conflict. While confirmation from either government remains elusive, crypto traders wasted no time rotating back into risk.
Bitcoin (BTCUSD) jumped as high as $106,000 in early Tuesday trading, climbing more than 7% from weekend lows. Ethereum (ETHUSD) surged 9% to $2,420, while Solana (SOLUSD) and Cardano (ADAUSD) spiked 11% and 9%, respectively. XRP (XRPUSD), Dogecoin (DOGEUSD), and Binance (BNBUSD) also caught bids, each rising between 4% and 6%.
Trump Sparks Rally with Ceasefire Post
At 6:02 p.m. EST on Monday, Trump posted on Truth Social:
Though missile fire from Iran was still reported early Tuesday, the market chose optimism. Bitcoin quickly reclaimed the key $105,000 level, while Ethereum recovered to its highest price in nearly two weeks. The global crypto market cap rose 2.4% to $3.35 trillion.
Ethereum’s rally was especially pronounced. Whale wallets reportedly accumulated over $265 million worth of ETH during the recent downturn, including one address that bought 47,070 ETH, about $113 million, over just three days. Network growth also remains strong, with over one million new Ethereum wallets added weekly since mid-May.
Liquidations Reverse as Sentiment Flips
Traders, who had been heavily deleveraging during the weekend’s violent price moves, re-entered long positions as volatility began to cool. According to Coinglass, total crypto liquidations hit $491 million over the past 24 hours, with short positions accounting for more than $375 million. Bitcoin alone saw $161 million in liquidations, while Ethereum followed with $140 million.
Alternative’s Crypto Fear & Greed Index jumped 18 points to 65, firmly in “Greed” territory, marking a dramatic shift in sentiment. Open interest rose 4% to $135 billion, and the average relative strength index across major tokens reached a neutral 58.
Augustine Fan, head of insights at SignalPlus, commented:
We think the market will soon normalize and move on from the latest geopolitical episode. But we’re more worried about a bigger shake-out to stop out recent longs… and the negative FOMO signals from all the public companies looking to establish new BTC treasuries as their latest financial engineering gig.
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Institutional Flows and Fed Bets Add Fuel
Institutional support hasn’t wavered. Despite the recent drawdown, Bitcoin’s derivatives market held steady. The total amount of leveraged Bitcoin positions sits near $68 billion, unchanged from pre-conflict levels. Bitcoin’s resilience above $100,000 has led some analysts to argue that it’s maturing into a true macro hedge.
Kay Lu, CEO of HashKey Eco Labs, stated:
Its ability to hold above $100K underscores resilience amid geopolitical and macro volatility. As institutional inflows and ETF demand rebound, BTC’s decoupling from traditional risk-off signals suggests a maturing role as a macro hedge in the long term.
Broader macro factors also buoyed sentiment. Oil prices tumbled after spiking on Sunday, and S&P 500 (SPX) futures rose 1% in after-hours trading. Traders are increasingly betting that the Federal Reserve may cut interest rates before year-end. CME FedWatch data shows the probability of a rate cut by November has jumped to 53%, up from 38% last week.
Traders Eye Next Move, Await Confirmation
While crypto markets cheered the ceasefire announcement, not everyone is convinced the geopolitical risk has passed. Israeli officials have yet to formally confirm the deal, and Iran’s earlier retaliation against U.S. assets in Qatar suggests tensions may not fully subside.
Still, for now, bulls are back in control.
Whether this rally holds will depend on one key factor: peace. Until Israel and Iran officially verify the truce and military activity ceases completely, traders will likely keep one hand on the sell button.
But for the moment, crypto markets have chosen to believe that the worst may be behind them, and prices are reflecting that hope.
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