US military allows neutral transit through Strait of Hormuz amid Iran blockade

The US military announced its blockade of Iran will permit neutral transit through the Strait of Hormuz, excluding specific areas around Iranian ports. The US-Iran ceasefire by April 30 market sits at 100% YES.

The UK strike on Iran by April 30 market remains at 3.6% YES, unchanged from 7 days ago. Allowing neutral transit narrows the blockade’s scope, which reduces the conditions under which other countries might get drawn into military action.

The other countries conducting military action against Iran by April 15 market is at 9.2% YES, down from 16% a week ago. The April 30 market is more active at 21.5% YES, down from 28%. The gap between these two contracts suggests traders see low probability of immediate escalation but are less certain about the rest of the month.

Volume across the combined markets was $1,046 in USDC over the last 24 hours, with $427 in depth to move prices 5 points. These are thin markets where a single large trade can shift prices meaningfully. The April 15 market saw $3,427 in daily USDC volume driving recent price moves.

This is a tactical de-escalation, not a strategic shift. The question for traders is whether controlled enforcement opens a path to diplomatic progress or just freezes the current situation. At 4¢, a YES share pays $1 if another country strikes Iran by April 30, a 25x return. That bet only makes sense if you expect a major change in the diplomatic situation.

Watch for statements from CENTCOM and Gulf state leaders, particularly Saudi Arabia and the UAE. Any shift in rhetoric or military posture could move these markets.

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