Ukraine agrees to US proposal for a 30-day truce: Will Bitcoin rally?

The United States and Ukraine have agreed on a proposal for an immediate 30-day ceasefire.

This news is pending Russia’s acceptance, according to a joint statement following high-level talks in Jeddah, Saudi Arabia.

Kyiv expressed its readiness to accept the truce, which could be extended by mutual agreement, provided Russia implements it concurrently. 

“Ukraine expressed readiness to accept the US proposal to enact an immediate, interim 30-day ceasefire, which can be extended by mutual agreement of the parties, and which is subject to acceptance and concurrent implementation by the Russian Federation,” the note read. 

In return, the U.S. committed to lifting the pause on intelligence sharing and resuming security assistance to Ukraine .

“The United States will communicate to Russia that Russian reciprocity is the key to achieving peace,” the statement said. The negotiations in Jeddah reportedly lasted over eight hours.

Bitcoin’s historical reactions to global conflicts

Bitcoin has had mixed reactions to global conflicts, with investors using it as both a risk asset and a potential safe haven. Market movements have shown patterns of initial volatility followed by recovery. The latest developments in Ukraine are no exception, as Bitcoin initially responded to the news.

In February 2022, as Russian military operations commenced in Ukraine, Bitcoin’s price dropped slightly, falling below $35,000.

However, research indicates that while Bitcoin trading volumes decreased by 0.2% for every 1% increase in conflict intensity, the cryptocurrency’s price often rebounded within approximately 50 days, showcasing its resilience. ​  

During the Israel-Gaza conflict in October 2023, Bitcoin’s price initially declined, reflecting broader market apprehensions. However, crypto has often functioned as a safe-haven asset during geopolitical crises, with some cryptocurrencies experiencing positive abnormal returns before such events.

Following the Ukraine announcement on March 11, crypto markets showed a positive reaction, with Bitcoin ( BTC ) jumping above $83,000 and the general market showing slight gains. 

In recent weeks, Bitcoin has been on a downward trend following President Donald Trump’s announcement of tariffs on Canadian steel and aluminum, as well as mixed reviews regarding the U.S. Strategic Crypto Reserve.