The situation around Ukraine is once again at the center of global politics. US President Donald Trump has proposed the idea of a ‘territory swap’, and on August 15 a summit with Vladimir Putin took place in Anchorage, Alaska.
European leaders are trying to influence the negotiations, and markets are assessing the likelihood of a turning point. For Bitcoin (BTC), which is trading around $117,787, such news is directly relevant: its price in 2025 will largely be determined by flows into spot ETFs and overall investor sentiment.
How Bitcoin Reacted to the Start of the Conflict
Chart: Bitcoin’s drop in 2022 — from $47,000 in March to below $20,000 by year-end (CoinMarketCap data).
On February 24, 2022, when active hostilities began, Bitcoin fell almost 8% in a matter of hours and dropped to $34,300 — a one-month low. However, just a few days later, there was a rapid rebound: on February 28, the price rose 14.5% in a single day, marking the biggest daily gain in over a year. By early March, BTC was trading 12% above pre-escalation levels, and by the end of the month had gained 27%, reaching $47,000.
This dynamic reflected the classic behavior of risk assets during a crisis. Initially, investors massively dumped all volatile assets, including stocks and crypto, moving into cash and US Treasuries.
Then came a reassessment of the situation: expectations of central bank policy easing and increased local demand for digital assets in countries with currency restrictions supported the rally.
Why the Talks Matter for BTC
Today, Bitcoin is even more integrated into the global financial system. Spot ETFs have become the main channel for institutional inflows, and macroeconomic factors — energy prices, inflation, and interest rates — directly affect the price.
The outcome of the Ukraine talks could impact all these parameters:
- Lower oil and gas prices could ease inflation.
- Central banks would have room to cut rates.
- Investor risk appetite would rise, and ETF inflows would accelerate.
Three Possible Scenarios
Full Ceasefire and Clear Settlement Plan
If the parties agree to a ceasefire and present a realistic plan, markets will breathe a sigh of relief. Energy prices will fall, inflation will decrease, and the Fed and ECB will have grounds for a softer policy. In such conditions, Bitcoin will be supported by increased ETF capital and overall market optimism.
Fragile Agreement Without Major Changes
If hostilities pause but sanctions remain and tensions persist, investors will be cautious. Energy prices will stabilize, but there will be no expectations of sharp rate cuts. In this scenario, Bitcoin is likely to remain range-bound, reacting with short-term spikes to negotiation news.
Breakdown of Talks and New Escalation
If dialogue breaks down and tensions escalate, Bitcoin will likely repeat the early 2022 scenario: a sharp drop along with stock markets, increased demand for the dollar and US Treasuries.
In regions with financial instability, people may move into stablecoins, causing their price to briefly rise above $1. Some of these funds then traditionally flow into BTC, supporting its rebound.
What Signals to Watch
- Interest rates and the dollar: rate cuts and a weaker dollar are positive for BTC.
- Spot ETF inflows: the main indicator of institutional demand.
- Options markets: reactions to geopolitics often appear here before spot prices.
- Stablecoin premiums: a rise in USDT or USDC above $1 signals increased demand in risk zones.
What’s Next?
A real ceasefire could drive a smooth but steady rise in Bitcoin due to an improved global macroeconomic picture. Prolonged talks or renewed escalation, on the other hand, will lead to a short-term dip, but the history of 2022 shows: such drops are often followed by a strong rebound. In any case, Bitcoin will remain an indicator of global risks and a tool closely watched by investors.
Read more: The US Treasury has backed away from its hardline stance and is once again allowing Bitcoin purchases
