The US has authorized its Navy to fire on Iranian boats attempting to disrupt the Strait of Hormuz, a move that has pushed odds of a near-term resolution lower across multiple Polymarket contracts.
The authorization to engage represents a direct escalation. The military action against Iran ending by April 1, 2026, market has seen odds decrease as traders price in prolonged hostilities. Odds of Strait of Hormuz traffic returning to normal by the end of June are also falling, since ongoing naval confrontations make a return to pre-crisis shipping levels harder to imagine.
The US blockade of the Strait of Hormuz market dropped from 72% YES to 63.5% YES in the last 24 hours, with a 5-point spike at 3:50 PM. Daily volume is $95,253 in USDC, and it takes roughly $8,995 to move the price 5 percentage points, which suggests institutional-sized participants are active in the book.
This matters because it signals a hardening US posture that reduces the probability of near-term de-escalation. The news originated from a Tier 3 source (@AJEnglish) rather than an official government release, but it is consistent with recent rhetoric from US officials. At 64¢, a YES position on Trump lifting the blockade by May 31 pays $1, but that outcome requires a visible turn toward diplomacy soon.
Watch for Pentagon announcements or statements from President Trump that could indicate a strategy shift. The situation in the Strait of Hormuz over the next few weeks will likely determine whether these contracts move further toward NO or begin to recover.
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