Bitcoin hovered near the $70,000 level as markets reacted to signs of potential de-escalation in the Iran conflict, with a wave of short liquidations exceeding $270 million helping fuel the advance.

Crypto markets rose alongside equities and futures after an Axios report indicated that the U.S. and Iran are discussing a possible 45-day ceasefire. Hopes of easing tensions—particularly around the critical Strait of Hormuz—lifted demand for risk assets, while the U.S. Dollar Index (DXY) moved lower.

Reports also suggest Pakistan is mediating talks under what’s being called the “Islamabad Accord,” which could lead to an immediate ceasefire and the reopening of key shipping routes. Despite the positive headlines, traders remain cautious about the likelihood of a deal being finalized.

Prediction platform Polymarket shows the probability of a ceasefire this month rising to around 30%, up from 18% before the latest developments. However, elevated oil prices and expectations that the Federal Reserve will keep rates unchanged continue to weigh on sentiment.

If a ceasefire is confirmed, analysts say a broader relief rally could further support risk assets. For now, markets appear to be treating the developments with measured skepticism.

Derivatives positioning points to growing bullish interest. Open interest in bitcoin and ether futures has increased by 7% and 11%, respectively, outpacing spot gains and suggesting fresh capital entering leveraged positions. Funding rates and cumulative volume deltas remain positive for both assets.

Altcoins such as Cardano (ADA), Avalanche (AVAX), and Chainlink (LINK) have seen double-digit increases in open interest alongside positive funding rates, indicating constructive sentiment. In contrast, Bitcoin Cash (BCH) and HYPE continue to show negative funding rates, reflecting bearish positioning.

Volatility has continued to ease, supporting the recent price strength. Bitcoin’s 30-day implied volatility index (BVIV) has fallen below 50% for the first time since early February, while Ether’s EVIV has dropped to multi-week lows.

Options markets highlight key levels to watch. On Deribit, bitcoin’s $60,000 put and $80,000 call each carry roughly $1.4 billion in open interest, making them significant zones for downside protection and upside positioning. A move beyond this range could trigger a sharp increase in volatility.

Despite bullish signals in futures, options markets remain cautious. Put options on BTC and ETH continue to trade at a premium to calls, signaling persistent demand for downside hedging. This skew is partly driven by call overwriting strategies used to generate yield.

In token developments, Algorand’s ALGO has rallied nearly 50% over the past month after a Google Quantum AI research paper highlighted its quantum-resistant design.

The report explored how blockchain networks could defend against future quantum computing threats capable of breaking current encryption systems. Algorand stood out for its use of FALCON, a post-quantum signature scheme selected by the U.S. National Institute of Standards and Technology (NIST).

Already integrated into features such as state proofs and certain transaction types, the technology has drawn renewed attention. ALGO has climbed from around $0.08 to near $0.12, lifting its market capitalization above $1 billion. The token is also up more than 7% in the past 24 hours, supported by the broader market rally.