A promise delayed is a promise not kept. From the White House:
While President Donald J. Trump signed the waiver under the Jerusalem Embassy Act and delayed moving the U.S. Embassy in Israel from Tel Aviv to Jerusalem, no one should consider this step to be in any way a retreat from the President’s strong support for Israel and for the United States-Israel alliance. President Trump made this decision to maximize the chances of successfully negotiating a deal between Israel and the Palestinians, fulfilling his solemn obligation to defend America’s national security interests. But, as he has repeatedly stated his intention to move the embassy, the question is not if that move happens, but only when.
Sure give the Palestinians this concession. They’ll pocket it and ask for more, and there will still be no peace deal.