June 12—A significant turn has emerged in the Middle East. Just hours after threatening military action against Iran, Trump indicated that a US-Iran agreement is close to completion and may be signed as early as this weekend. Qatar, the UAE, and Pakistan have simultaneously stepped in as mediators, and markets are beginning to price in the possibility of Hormuz Strait shipping recovery and regional de-escalation. However, Iran's Foreign Ministry and negotiating team continue to deny that any final agreement has been reached, while Iran's military maintains its highest state of alert—indicating that geopolitical risk has not yet truly been resolved.

From a market perspective, the biggest shift is not that the war is ending—it is that capital is beginning to price the post-war order. US Treasury Secretary Bessent has even publicly mentioned the use of Iran's frozen assets to compensate Gulf countries for their losses, suggesting that part of the US discussion has shifted from escalation to reconstruction and regional governance. But core disagreements over the nuclear program, sanctions relief, and Israeli security demands remain unresolved, leaving markets exposed to the risk of agreement reversal.

At the same time, another potential change at next week's Fed meeting is equally worth watching. Markets expect new Chair Kevin Warsh may gradually downplay forward guidance and the rate dot plot, returning more pricing power to the market itself. Against a backdrop of significant uncertainty around inflation and growth, this would mean that the future rate path becomes more dependent on market judgment—with the potential to push both bond yields and risk-asset volatility higher.

For crypto, the real pressure remains on the funding side. Data shows that crypto ETFs have seen $405 million in net outflows over the past week and $5.49 billion over the past month. Even as geopolitical risk eases in the short term, institutional capital has not visibly returned—and the market remains caught in a tug-of-war between liquidity recovery and a high-rate environment.