Bitcoin briefly slipped below $65,000 on Wednesday after Iran rejected renewed prospects for peace talks with the United States, adding fresh pressure to risk assets as military operations continue. The decline interrupted a rally that had followed softer-than-expected U.S. Producer Price Index (PPI) data earlier in the session.
Iran dismisses Trump's claim of diplomatic outreach
Iran's Foreign Ministry said there are currently no plans for negotiations with the United States, with the country's immediate priority remaining its defense efforts. The statement came after U.S. President Donald Trump claimed during a FOX interview that Iran had reached out earlier and wanted to make a deal, suggesting diplomatic contact could resume.
The conflicting messages have arrived as the U.S.-Iran conflict intensifies once again. Over recent days, both countries have continued exchanging strikes, while Trump has reinstated the Iranian blockade in the Strait of Hormuz and warned that Washington could expand military operations if Tehran does not return to negotiations.
Military strikes escalate, markets react
Fresh military operations kept risk appetite under pressure. The U.S. Central Command (CENTCOM) announced on X that it had completed a 90-minute wave of strikes targeting coastal defense systems and cruise missile storage and launch sites on Greater Tunb Island. According to CENTCOM, the operation was intended to reduce Iran's ability to threaten commercial shipping through the Strait of Hormuz.
Hours later, CENTCOM announced another escalation. In a separate post, the command said U.S. forces launched a second wave of strikes at 3 p.m. ET, targeting Iranian military capabilities used to threaten vessels transiting the Strait of Hormuz. CENTCOM described the waterway as vital to global commerce and said the operation was carried out under the direction of the U.S. Commander in Chief.
Prediction markets see slim odds for diplomacy
Beyond price action, prediction markets continue to indicate low expectations for a diplomatic breakthrough this month. Data from crypto-based prediction platform Polymarket shows traders currently assign only a 25% probability that another round of U.S.-Iran peace talks will take place before the end of July.
Attention is also turning toward Iran's senior leadership for additional guidance on the country's position. Mohammad Qalibaf, identified as Iran's top negotiator, is expected to issue a statement later today addressing the ongoing conflict and recent military developments.
For now, financial markets remain caught between improving U.S. inflation data and rising geopolitical uncertainty. While softer inflation initially supported demand for Bitcoin and other digital assets, Iran's rejection of negotiations, continued U.S. military strikes, and uncertainty surrounding future diplomatic efforts have kept traders focused on geopolitical headlines as the next major driver of market sentiment.