After 21 hours of continuous talks in Islamabad, Pakistan, the U.S.-Iran peace deal broke down on April 12, 2026. Financial experts said that this will now trigger a market crash once the market opens on Monday.
And Crypto will take the hardest hit. Early signs of weakness are already visible, with Bitcoin and Ethereum both slipping around 1.5% today.
In a recent press release, U.S. Vice President JD Vance announced that the peace talks between the U.S and Iran failed to reach an agreement, saying Iran had “chosen not to accept our terms.” The sticking point was non-negotiable for Washington.
Vance stated that the U.S. needed “an affirmative commitment that they will not seek a nuclear weapon and will not seek the tools that would enable them to quickly achieve a nuclear weapon,” calling it the core goal of President Trump’s entire negotiation strategy.
Within hours of the announcement, President Trump took to Truth Social, declaring that Iran was “unwilling to give up its nuclear ambitions” and ordered the U.S Navy to immediately begin blockading the Strait of Hormuz.
However, the collapse also puts a fragile two-week ceasefire at risk, increasing fears of further escalation.
With diplomacy failing, traders are now pricing in conflict risk.
At the same time, bonds are being sold, yields are rising, the dollar is weakening, and liquidity is tightening.
The Federal Reserve has also raised its 2026 inflation forecast to 2.7% as oil stays above $100, and hopes of rate cuts are fading. This leaves central banks with limited options to support the economy.
With all this pressure, stock markets may see heavy selling when trading opens on Monday.
Crypto is usually hit harder than stocks in these conditions. That’s already starting to show. Bitcoin price already dropped below $71,000, while Ethereum fell below $2,200, and the total crypto market cap slipped nearly 1%, falling to $2.41 trillion.
This fearful behavior can be seen in whale activity, too. A large whale made a big trade of over $10 million as soon as Bitcoin dropped below $71,000. This is often seen as a sign that the current trend may continue.
At the same time, market makers are selling, and both open interest and spot trading volume are going down.
In Ethereum, a whale holding 131,000 ETH (worth about $288 million) recently made a profit. They bought 5,039 ETH at $1,985 two weeks ago and just sold 5,000 ETH at $2,202, locking in gains.
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