Are Traders Ahead of the Truth? War Pause Hype Fuels Risky Crypto Bets

Two major sentiments linked to the prospect of war have lifted crypto, but uncertainty remains as to whether this rally can continue.

Bitcoin continues to trade around the $71,000 level, as it has shown steady performance amid growing global uncertainty affecting the broader financial markets. Its trajectory is different from that of gold, which has weakened significantly despite its reputation as a traditional store of value.

A new study has found that its recent gains are influenced more by changing expectations of conflict resolution than fundamentals. As a result, prices may be vulnerable to rapid changes if the geopolitical outlook deteriorates.

Peace Talks or Market Trap?

Santiment’s latest data shows a clear rise in online discussions, suggesting that the geopolitical conflict may be nearing an end. Discussions have been growing rapidly across platforms such as X, Reddit, and Telegram, reflecting growing anticipation of the recession among traders and investors.

The analytics firm pointed to two distinct increases in crowd confidence since the conflict began. The first occurred on March 9, when sentiment strengthened after US messages described the situation as short-lived, consistent with early signs of a downward trend. This narrative coincided with the initial pullback in oil prices, as traders increasingly positioned themselves to ease tensions faster than previously expected.

The second, more prominent increase in optimism was recorded on March 23, shortly after Donald Trump’s confirmation of a temporary suspension of strikes and the presentation of a formal American proposal to Iran, which indicated that formal negotiations could continue.

Financial markets reacted quickly to these changes. Both equities and cryptocurrencies rose sharply as participants began to price in the growing possibility of a downturn. Santiment explained that recent gains in crypto markets are closely related to this growing expectation of conflict resolution, and sentiment-driven momentum continues to influence short-term price action.

All Eyes on the Clock

The company added that the perceived volatility is likely to continue in the current five-day period, and focuses on two main scenarios. A successful solution could trigger a broader market breakout, although high enthusiasm could also increase the likelihood of a “buy the rumor, sell the news” reaction.

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On the other hand, the breakdown of negotiations can make it difficult to predict the crypto market and put a temporary pause in the growth of the overall market until whales and retail investors get more clarity on the direction of the conflict. However, Santiment said it doesn’t necessarily mean a big drop, as prices have been stable during the war so far.