The historical deal between the US and Iran did not hold Bitcoin back: the Fed's hawks proved stronger.
The signing of a peace memorandum between Washington and Tehran has become a truly historic geopolitical event, capable of redrawing the map of the Middle East. However, for the digital asset market, this positive development proved to be only a short-term impulse. At the time of writing this analysis, the flagship cryptocurrency is trading near the $63,800 mark, having lost 2.80% over the past 24 hours. Investors' joy was short-lived — the Federal Reserve's hawkish rhetoric has once again shifted the focus back to macroeconomic risks.
What does the peace memorandum mean for markets?
The document includes 14 key points aimed at ending hostilities and stabilizing the region. The agreement provides for the launch of verification mechanisms, a partial lifting of sanctions, and a clear timeline for technical negotiations on Tehran's nuclear program. Pakistan played a mediating role, with support from Qatar, Saudi Arabia, and Turkey. The Trump administration called this "the art of the deal" and a diplomatic victory for itself.
Immediately after the news was announced, Bitcoin surged to $66,315 — geopolitical détente gave a powerful boost to risky assets. Oil and gold, on the other hand, moved into negative territory, as the geopolitical premium instantly disappeared. However, the euphoria proved fleeting.
Why the Fed's hawkish rhetoric crashed Bitcoin
New Fed Chairman Kevin Warsh held his first Federal Open Market Committee meeting on June 17. The regulator left the key interest rate unchanged at 3.50-3.75% for the fourth consecutive time, but any hints of a possible policy easing disappeared from the official statement. The shift to a neutral approach, fully tied to the latest data, caught markets off guard. Moreover, 9 out of 18 Committee members now forecast at least one rate hike in 2026 — a stark departure from previous expectations of cuts or a pause.
The hawkish stance confirms expert warnings about growing risks of a rate hike as early as September. Rising wages, sustained consumer activity, supply-side constraints, and record investments in AI are keeping inflation at around 4.2% — significantly above the Fed's 2% target.
Markets reacted immediately: the S&P 500 fell by 1.5%, the Nasdaq lost 2%, and the Dow Jones dropped 160 points. The yield on two-year Treasury bonds jumped 11 basis points to 4.153%, while ten-year yields rose 12 points to 4.469%.
The cryptocurrency sector fully mirrored the movement of traditional markets, where a massive flight of investors from risky instruments was observed. Bitcoin could not withstand the pressure from the Federal Reserve — not even the positive geopolitical backdrop helped. At the time of writing this review, the flagship is trading 4% below its weekly high of $67,203.
Analyst's comment: The current situation clearly illustrates the most important rule for all crypto investors: loud geopolitical events can only provide short-term support for the price. In the medium term, the trajectory of Bitcoin and other risky assets continues to be shaped by the central bank's monetary policy. As long as the Fed's hawks hold the helm, any euphoria will quickly be dampened by macroeconomic reality.