Bybit, the world’s second-largest cryptocurrency exchange by trading volume, has released the latest Bybit x Block Scholes Crypto Derivatives Analytics report, highlighting how a fragile US–Iran ceasefire has tempered bearish sentiment in crypto markets while leaving broader uncertainty unresolved.
Key findings:
Bitcoin rebounded above $70,000 following the ceasefire announcement.
Market activity reflects short squeeze accompanied by fresh positioning.
Sentiment has improved, but remains cautious amid ongoing geopolitical risks.
The report found that digital asset markets reacted swiftly to news of a conditional two-week ceasefire between the United States and Iran, particularly due to the agreement’s provision for reopening the Strait of Hormuz. This development eased immediate geopolitical concerns and helped lift Bitcoin above the $70,000 level for the first time since late March, alongside gains in other major cryptocurrencies.
Analysis of derivatives data suggests that the rally was not solely driven by the liquidation of bearish positions. While approximately $56 million in short positions were cleared on Bybit’s Bitcoin perpetual contracts, open interest increased alongside prices, indicating that traders were actively adding new exposure. At the same time, funding rates remained relatively stable, pointing to measured risk-taking rather than aggressive positioning.
Han Tan, Chief Market Analyst at Bybit, said the ceasefire has provided some support but remains fragile. “The US-Iran ceasefire has offered some relief for risk assets, including cryptos. However, relief rallies across the risk complex have been limited by lingering doubts over a meaningful end to this Middle East conflict,” Tan said. “The fragile ceasefire remains on shaky ground.”
He added that downside risks remain pronounced if tensions escalate again.
“Should this pause in the war shatter abruptly, risk assets are bound to give up much of their recent gains,” Tan said. “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.”
Options markets also reflect a cautious shift in sentiment. While the premium for downside protection has narrowed, it has not flipped decisively bullish, indicating that investors are adopting a wait-and-see approach as they assess whether the ceasefire can lead to a more durable resolution.
The report concludes that although crypto markets have shown resilience and led the initial relief rally, the sustainability of these gains will depend on further geopolitical developments and their implications for inflation and global monetary policy.
The full Bybit x Block Scholes report is available for download.
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