Markets fell after new statements from Donald Trump on Iran and signals from Fed Chair Kevin Warsh. Investors were waiting for clarity, but instead got even more uncertainty.
On Wednesday, U.S. stock indices went down after Trump said that the memorandum of understanding with Iran cannot yet be considered a final deal. The market fears that the situation around the Strait of Hormuz will not calm down quickly. If oil supplies remain at risk, inflationary pressure may persist. Against this backdrop, both stocks and bitcoin are again in question.
The U.S. and Iran are expected to sign an agreement on Friday. After that, a 60-day negotiation period will begin. At the same time, Trump’s rhetoric remains contradictory. On the one hand, he said the deal should please the markets and could lower oil prices. On the other hand, the U.S. president threatened new strikes if Iran does not behave properly.
Yield of 5-year U.S. Treasury bonds and Brent oil price (USD). Source: TradingView
Brent oil fell to a 100-day low. But traders are not sure this will relieve pressure from the markets for long.
The yield on 5-year U.S. Treasury bonds remained around 4.16%. Over two weeks, the figure has hardly changed. This suggests that investors are still in no hurry to price in a quick Fed rate cut. As long as there is no confidence in a policy reversal by the regulator, the market continues to demand higher yields on government debt.
Impact of Inflation and Weak Demand on Bitcoin
Retail sales data in the U.S. published on Wednesday showed a 6.9% increase compared to May 2025. But this jump does not necessarily indicate a strong consumer. Part of the growth could be due to rising prices for goods, including fuel.
On the same day, the first FOMC meeting under Kevin Warsh took place. The rate was left unchanged, and the market was generally prepared for this. What is much more important now: investors are trying to understand what Warsh himself will be like. How tough will his stance be and is he even ready to move quickly toward rate cuts.
Nasdaq-100 futures (left) and bitcoin to U.S. dollar rate (right). Source: TradingView
Nasdaq-100 was trading about 2% below its all-time high. Meanwhile, since mid-May, bitcoin has been unable to confidently stay above $80,000.
Caution in the crypto market is not only related to macroeconomics. Large players are not yet showing strong demand for BTC. There is no noticeable inflow into spot bitcoin ETFs, and there is no premium on Coinbase compared to international exchanges. Usually, such a premium indicates buying by American institutions. There is no such signal now.
Bitcoin price on Coinbase in U.S. dollars compared to BTC price in USDT pairs on international exchanges. Source: TradingView
For five weeks now, bitcoin on Coinbase has been trading at a discount to international platforms, where USDT pairs remain the main benchmark. This is a negative signal for the market. It shows that demand from American investors is weaker than on global platforms.
Spot bitcoin ETFs are also increasing the pressure. Since the beginning of June, about $2.1 billion has been withdrawn from them. This only reinforces the view that institutional interest in BTC has now declined.
An additional factor was the weakness of Strategy Preferred Perpetual Equity (STRC). This is a perpetual preferred instrument by Strategy. Its decline is seen by the market as another sign of caution toward risky assets.
Strategy Stretch perpetual preferred shares (STRC). Source: TradingView
STRC gives holders a yield of 11.5% per year. But the instrument has a limitation: new shares can only be issued at a fixed price of $100.
Because of this, Strategy has less room to maneuver. Every month, the company needs to pay about $142 million in cash dividends. To cover these payments, it has to either issue more shares and dilute MSTR holders’ share, or spend dollar reserves. Currently, they amount to about $1.1 billion.
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The total volume of preferred shares issued by Strategy has reached $15.5 billion.
There are still no signs that the company will have to sell its bitcoins in the near future. But the decline in STRC shows that investors are looking more cautiously at Strategy’s financial leverage.
Even if inflows into bitcoin from large players return, the market is still hampered by geopolitical risk. Investors fear that the agreement between the U.S. and Iran may fall through. Therefore, a confident return of BTC to $80,000 may take more time.
