Bitcoin Slumps Below $73k Even With Iran Deal Hype (We’ve Seen This Before)

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Markets, that perpetually overwrought lot, spent the morning behaving exactly as one would expect of people who have been promised the same peace deal a dozen times before.

What to know:

  • Markets reacted to the news of a reported draft deal and last night’s U.S. airstrikes near the Strait of Hormuz by, as is their custom, pushing stocks and bonds higher, oil lower, and giving bitcoin the cold shoulder as it continued to slump into irrelevance.
  • The Fed’s preferred inflation gauge, the PCE index, rose to 3.8% in April, its highest mark since 2023, piling more unwelcome pressure on policymakers who are already stuck wrestling with the nagging, uncooperative problem of rising prices that refuse to go away.

Axios reported that U.S. and Iranian negotiators hashed out a draft 60-day memorandum of understanding to extend the ceasefire and kick off talks around Iran’s nuclear program, though President Trump has yet to give the deal his stamp of approval. It is the sort of tentative, half-baked promise that everyone in the room has heard a hundred times before, like the local innkeeper swearing he’ll finally pay back the 10 rubles he owes the merchant by the end of the month.

The report came just hours after overnight U.S. airstrikes hit an Iranian military site near the Strait of Hormuz, that narrow, much-contested energy shipping route that has dominated every macro trader’s conversation for months now, the way a juicy local scandal dominates the gossip at the village well.

Traders, by this point, have lost count of how many “imminent” Middle East peace deals they’ve been promised-they’ve lost track so thoroughly they’ve stopped even pretending to care, as they sip their lukewarm coffee and stare at their screens-but they still went ahead and bid stocks and bonds higher, oil lower, as if this time will be different. The Nasdaq, which was in the red earlier in the day, is now up a modest 0.6%, while WTI crude oil has tumbled below $90 per barrel, a small, meaningless win that the crowd cheered for all of five minutes before moving on to the next bit of news.

Crypto markets, meanwhile, have remained stuck in their usual listless doldrums, with bitcoin failing to hold even the tiniest of upward bumps, like a drunkard who can’t stay upright for more than two seconds after a night of drinking at the local tavern, and has now sunk back below $73,000, down 2.7% over the past 24 hours. No one in the room batted an eye, of course-it’s the equivalent of the town drunk showing up to the tavern drunk again, and everyone just nods and goes back to their tea.

Following the Axios story, Treasury Secretary Scott Bessent warned the U.S. would “not tolerate” any attempt to impose tolls on shipping through the Strait of Hormuz, vowing aggressive sanctions against any parties involved in disrupting commercial transit through the key waterway. “Oman, in particular, should know that the U.S. Treasury will aggressively target any actors involved-directly or indirectly-in facilitating tolls for the Strait, and any willing partners will be penalized,” he wrote, in the sort of stern, empty threat that sounds very impressive on paper but rarely amounts to much in practice, much like the local constable threatening to crack down on rowdy teenagers who just laugh and keep drinking.

The Fed’s Favorite Inflation Gauge Hits Its Highest Mark Since 2023, Because Why Not

The first inflation report released under Federal Reserve Chair Kevin Warsh showed price pressures strengthened in April, with the Fed’s preferred inflation gauge, the Personal Consumption Expenditure Index (PCE), rising to its highest level in nearly three years, 3.8% year over year, up from 2.8% back in February. It is the sort of unwelcome surprise that makes you want to sigh, pour yourself another glass of cheap tea, and wonder why you ever thought things would get better this year.

“The inflation picture is becoming increasingly uncomfortable for the Fed. This is not just a headline inflation problem: core inflation is moving the wrong way too,” said Olu Sonola, head of U.S. economics at Fitch Ratings, in the calm, resigned tone of a man who has seen this movie far too many times to be surprised. “Price pressures are likely to persist over the next few months, and while the Fed cannot fix a supply shock, it cannot ignore one that is feeding into underlying inflation. The Fed is stuck – and the heat is clearly being turned up.” It is the sort of obvious, deeply unhelpful statement that makes you wonder why they even bother saying it out loud, much like the local doctor telling you your cold will go away on its own, just as you suspected.

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2026-05-28 18:21