Donald Trump signed the US-Iran peace memorandum of understanding at Versailles on June 17, and Bitcoin briefly shot up to $66,315. But the rally didn't last. Hours later the Federal Reserve held interest rates steady for the fourth straight meeting — and hinted that a rate hike might be back on the table. By Thursday, Bitcoin was trading at $64,339, down 2.10% in the past day and sitting 4.10% below its weekly high of $67,203.
Peace deal gives crypto a short-lived boost
The 14-point MoU, mediated by Pakistan with backing from Qatar, Saudi Arabia, and Turkey, ends military operations and sets up a verification framework plus partial sanctions relief. Geopolitical wins can lift sentiment fast, and they did — Bitcoin jumped almost $2,000 on the news. But the pop faded within hours as traders turned their attention to the Fed.
Fed holds firm, but hawkish signals emerge
The Federal Open Market Committee kept its benchmark rate at 3.50%-3.75% on June 17, as expected. What wasn't expected: the statement scrubbed all previous language about additional rate adjustments, replacing it with a neutral, fully data-dependent tone. More striking, nine of the 18 FOMC participants now project at least one rate hike for 2026 — a sharp pivot from earlier forecasts of cuts or extended holds. Inflation is still running at about 4.2% year-over-year, more than double the Fed's target. The committee isn't ready to declare victory.
Risk assets take the hit
Equities sold off hard after the decision. The S&P 500 fell 1.5%, the Nasdaq dropped 2%, and the Dow lost 160 points. Bond yields rose too: the 2-year Treasury yield climbed 11 basis points to 4.153%, and the 10-year yield rose 12 basis points to 4.469%. For Bitcoin, the macro picture matters more than a diplomatic handshake. A higher-for-longer rate environment — or an actual hike — tends to pull capital out of speculative assets. The timing isn't great for a crypto market that was already struggling to hold above $65,000.
Monetary policy decisions dominate the medium-term outlook for Bitcoin and risk assets. The next FOMC meeting in late July will be the real test — if inflation doesn't cool by then, the odds of a 2026 rate hike will only harden. For now, the peace deal gave a one-day headline pop, but the Fed's message is the one that's sticking.
