The price of Bitcoin briefly hit $72,700 on Wednesday as traders celebrated the U.S.-Iran ceasefire agreement, but fell below $71,000 within hours as fresh violence in the Middle East crushed optimism.

The price rally was real — but it didn't last long enough to be significant.

Hormuz is still blocked, oil prices are recovering

Israel carried out the largest strike against Lebanon to date, hitting over a hundred Hezbollah targets in the Beirut area in less than ten minutes. The Speaker of Iran's parliament stated that three ceasefire conditions had already been violated, raising the price of WTI crude oil by 2.8% to $97.03 and Brent oil by 2.5% to $97.14 per barrel, nearly recovering from the previous session's 16% collapse.

In the Strait of Hormuz, where approximately 135 vessels typically pass daily, only three transit vessels were noted on Wednesday. Over 800 vessels are still stuck in the Persian Gulf, awaiting clear instructions for safe passage.

The value of Ether fell by 1.1% to $2,185, following Bitcoin's price drop as risk appetite weakened broadly. The price of gold dipped slightly to $4,713, and the dollar exchange rate remained stable, indicating that the markets were cautious but not in full panic.

Market analysts noted that the price rally was mainly driven by algorithmic and sentiment-based trading, not genuine improvements in the fundamentals. The rebound was short-lived as geopolitical pressures returned.

The Fed increases pressure on the markets

The minutes from the March meeting of the U.S. central bank, published on Wednesday, showed concern among policymakers about persistent inflation. Some officials noted that the Fed should keep rate hikes possible if oil prices remain high.

A prolonged blockage of the Strait of Hormuz would raise energy prices, delaying the Fed's monetary policy shifts that the crypto markets have hoped for. Higher interest rates historically pressure risky assets like Bitcoin, making the uncertainty of war and hawkish Fed messages a tricky combination for bulls.

At the time of writing, Bitcoin's macroeconomic environment is challenging — hopes for a ceasefire are fading and the Fed is not in a hurry to ease its policy.