Easing Geopolitical Risks Boost Markets, But Strategy-Related Overhang Continues To Weigh On Bitcoin, QCP Says

Singapore-based digital asset trading firm QCP Capital has released a new market report assessing recent developments in global financial markets and their implications for cryptocurrencies. The firm highlighted easing geopolitical tensions, upcoming monetary policy decisions, and continued strength in equity markets as key factors shaping investor sentiment. 

According to the report, risk assets received a boost after the United States and Iran reportedly reached a memorandum of understanding over the weekend. The agreement is expected to pave the way for the reopening of the Strait of Hormuz and a broader reduction in tensions between the two countries. Following the announcement, S&P 500 futures advanced to record levels, while oil prices moved lower as markets reduced expectations of prolonged disruptions to global energy supplies.

QCP noted that both sides are expected to enter a 60-day negotiation period focused on issues including nuclear policy, sanctions relief, and the release of frozen Iranian assets. While geopolitical risks remain, the firm said the agreement has reduced concerns surrounding one of the market’s most significant near-term risks.

Attention is also turning to monetary policy, with Federal Reserve Chair Kevin Warsh presiding over his first policy meeting. Although Warsh had previously been viewed as supportive of lower interest rates, recent economic conditions have complicated that outlook. Rising energy prices linked to the US-Iran conflict have contributed to higher inflation, increasing pressure on policymakers to maintain a cautious stance.

Investors are expected to closely monitor the Federal Reserve’s updated economic projections and interest rate outlook. QCP said markets are looking for indications that policy could remain restrictive in the near term as inflationary pressures persist.

Equity Market Momentum and Bitcoin Outlook

Meanwhile, equity market momentum has continued to strengthen. QCP highlighted the recent performance of SpaceX following its public market debut, noting that strong investor demand has pushed the company’s valuation sharply higher. The firm also pointed to SpaceX’s acquisition of AI company Cursor as evidence of its ambitions beyond the aerospace sector, reflecting growing investor enthusiasm for companies operating at the intersection of AI and infrastructure development.

Despite improving sentiment across traditional markets, Bitcoin has lagged behind broader risk assets. QCP attributed part of the underperformance to concerns surrounding Strategy’s financing activities. The company recently repurchased a portion of its convertible debt and subsequently raised additional capital through equity sales while continuing to acquire Bitcoin.

According to the report, these developments have created uncertainty around near-term demand dynamics for the cryptocurrency. While the broader macroeconomic environment has become more supportive, QCP believes Bitcoin may continue to face pressure until concerns related to Strategy’s funding position begin to ease. The firm added that a more favorable market backdrop could ultimately benefit Bitcoin once these factors are absorbed by the market.

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