Iran-US Negotiations Unclear, Bitcoin and Others Move Wildly Uncontrollably
The cryptocurrency asset market on Thursday’s trading (07/05/2026) showed fluctuating movements in response to a rapidly developing series of geopolitical events in the Middle East.
On one hand, strong indications of an impending memorandum of understanding (MoU) for peace between the United States and Iran are providing a boost of optimism. On the other hand, a military incident in the Strait of Hormuz is reminding the market of the high risk of volatility before a final agreement is truly signed.
Amid this tug-of-war situation, Bitcoin (BTC) is observed holding above the psychological level of $81,000. Market participants are now in an anticipatory phase, awaiting final confirmation of the conflict resolution within the next 48 hours, which will determine the direction of subsequent macroeconomic liquidity.
Bitcoin Stable, Ethereum Continues Strengthening
Based on the latest trading data, Bitcoin (BTC) is traded at $81,351.40. This largest market cap cryptocurrency recorded a daily gain of +1.91%, although weekly it showed relatively flat movement with a slight correction of -0.19%.
This stability indicates that market participants are holding back from aggressive selling or buying actions while awaiting clarity on the geopolitical status.
A more positive dynamic is shown by Ethereum (ETH). This asset is leading the recovery among major assets with a daily surge of +9.56% to $2,586.29, and booking a weekly appreciation of +6.25%.
The strengthening of ETH indicates a selective rotation into the smart contract ecosystem, which is deemed to have lower exposure to short-term volatility compared to Bitcoin.
Altcoin Dynamics: Dogecoin and HYPE Lead Sectoral
In the altcoin sector, the movement of most large-cap assets shows measured daily recovery. Binance Coin (BNB) rose +2.05% to $636.57, Solana (SOL) strengthened +2.13% to $86.82, and XRP recorded a +1.43% increase to $1.42.
The most significant movement was again recorded by Dogecoin (DOGE), which jumped +4.20% daily and recorded the highest weekly appreciation at +21.43%, bringing it to $0.1165.
Positive performance was also maintained by Hyperliquid (HYPE), which grew +7.86% over the week to $41.85. Overall, the altcoin market is responding positively to the fading threat of broad conflict escalation.
Tug-of-War Negotiations and Strait of Hormuz Incident
The fundamental dynamics driving the market at present are in a crucial phase. Diplomatic negotiations between the US and Iran are reported to be at the closest point to an agreement.
Intensive discussions on the 14-point MoU are underway, covering Iran’s moratorium on uranium enrichment in exchange for easing economic sanctions and the release of billions of dollars in funds by the US. President Donald Trump has also instructed a temporary halt to the ‘Freedom Project’ in the Strait of Hormuz as a gesture of good faith in the negotiations.
However, the situation on the ground remains filled with uncertainty. Despite the diplomacy progressing, the US military reported firing on the Iranian-flagged tanker M/T Hasna, which was claimed to have attempted to breach the blockade.
This incident, along with threatening rhetoric from Trump to continue bombing if negotiations fail, signals that regional stability is still highly vulnerable and could deteriorate at any time.
If this peaceful resolution fails to be implemented and the Strait of Hormuz blockade continues, the global market will face an unavoidable scenario of surging oil prices.
This condition will trigger structural inflation in the United States and force the Fed, under the leadership of Kevin Warsh, to respond with tight monetary policy. The potential interest rate hikes to curb energy inflation will drain market liquidity and pressure valuations of risky assets, including Bitcoin.
Recalling similar events in history in the 1970s when an oil embargo was imposed, leading to an oil crisis that caused stagflation and forced the FFR to rise to double digits.
Aggressively Outlook Market
Facing the convergence between negotiation optimism and macroeconomic risks, the fundamental view for medium- and long-term projections remains maintained. The current $80,000 to $85,000 price range has the potential to become a strong technical resistance area.
For investors with adequate risk tolerance, this level can be considered as an area to open short positions, anticipating potential volatility if the peace agreement hits another dead end or if inflation impacts begin to be realised by central bank policy.
For the long term, the main target remains conservatively maintained in the $40,000 to $50,000 price range. This area is projected as the optimal cycle bottom, expected to form in Quarter III or Quarter IV of 2026. A disciplined strategy with risk management and maintaining cash liquidity portions (wait and see) remains the most relevant option.