Trakx Weekly Update: Hope Meets Headwinds

Key Crypto Market Figures

CTIs Weekly Performance

Digital asset markets were unable to sustain bullish momentum last week despite the signing of a US-Iran Memorandum of Understanding (MoU) aimed at ending hostilities between the two countries (see below). As a result, our flagship large-cap crypto index, the Top10 CTI, declined by almost 4%. AI-related tokens were among the weakest performers. The AI CTI and AI Agent CTI fell 9% and 7%, respectively, reflecting a broad pullback across the sector. In contrast, the Decentralised Exchange (DEX) CTI was the strongest performer over the seven-day period, gaining 6%.

Sign, Sealed… Delivered?

Last Wednesday, at the Palace of Versailles, President Trump signed a historic Memorandum of Understanding (MoU) aimed at ending hostilities with Iran and reopening the Strait of Hormuz. After more than 109 days since the first airstrikes against Tehran were launched – a period far longer than originally anticipated – a significant war premium has been incorporated in many asset prices. As a result, the signing triggered an initial “risk-on” environment, providing a short-term fillip to crypto prices, as crude oil fell below $80 per barrel.

Under the terms of the MoU, “[i]mmediately upon the signing,” the US would begin removing its naval blockade of the strategically important waterway over the following 30 days. Iran, in turn, would restore vessel traffic “in proportion to the numbers of pre-war traffic” over the same period. In practical terms, however, the agreement does not immediately resolve the supply imbalance in global oil markets. Crude oil supply is likely to remain below demand for some time, implying further drawdowns in both strategic and commercial reserves. Nevertheless, the expectation that global supplies will eventually be fully restored provided investors with sufficient confidence to reduce the risk premium embedded in oil prices.

That said, with the ink barely dry on the agreement, optimism quickly faded. Peace talks between the US and Iran, scheduled to begin in Switzerland last weekend, were abruptly suspended following Israeli airstrikes in Lebanon, which Iran argued contravened the first of the MoU’s 14 points. While this injected a bearish tone to the digital asset space, the eventual resumption of talks, resulting in what the mediators Pakistan and Qatar described as “encouraging progress”, helped to limit the losses. Nevertheless, this stop-start dynamic underscores the challenge of turning a MoU into a permanent peace agreement, particularly given the unresolved and highly contentious issue of Iran’s stockpile of enriched uranium.

Warsh’s FOMC Debut

Another factor that weighed on bullish price action mid-week was Fed Chair Kevin Warsh’s debut FOMC press conference. Although Warsh has historically held views that were perceived as supportive of the digital asset industry, his remarks struck a distinctly hawkish tone. During the press conference, Warsh emphasised that US inflation remains stubbornly above the Fed’s 2% target, a reality that he suggested was incompatible with his commitment to maintaining “uncompromising price stability.” He also declined to provide any meaningful forward guidance on future rate decisions, noting only that the Fed would meet again in six weeks.

In addition, Warsh announced the formation of five task forces mandated to re-evaluate a range of Fed practices, including its communications strategy, the use of “dot plot” projections, and the methods by which the central bank processes inflation data. The announcement of such sweeping reviews—something that was certainly not on many investors’ 2026 bingo cards—suggests that it may take time for markets to understand how the Fed’s reaction function (i.e., how it intends to balance its dual mandate of full employment and price stability) could evolve under its new leadership. As is often the case, this uncertainty became a headwind for risk assets.

Spotlight On Stablecoins

Away from geopolitics and monetary policy, one of the more notable developments last week was the continued push by tradfi institutions into stablecoin infrastructure. On June 16, State Street launched a GENIUS Act-compliant money market fund specifically designed to hold reserves backing stablecoins, joining a growing list of major financial institutions seeking to service the sector. The fund invests in cash, short-dated US Treasuries and repurchase agreements, reflecting the increasingly regulated nature of stablecoin reserve management under the US regulatory framework. The following day, Fidelity launched its own stablecoin reserve fund, highlighting how rapidly competition is intensifying among traditional asset managers.

Taken together, the announcements suggest that some of Wall Street’s largest firms increasingly view stablecoins not as a niche crypto product, but as a potentially significant source of future assets under management and treasury demand. For digital asset investors, the significance lies less in the individual fund launches and more in what they represent: the continued institutionalisation of the stablecoin market and the growing convergence between tradfi and blockchain-based payment networks.

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Trump nears Iran deal but crypto market ignores the news: Crypto.news
• Bitcoin, ether slide after a hawkish Fed, even as Trump’s signed Iran deal lifts stocks: Coindesk
• State Street launches GENIUS-compliant money market fund for stablecoin issuers: The Block
• Ethereum Foundation leadership exodus continues with director’s departure: Cointelegraph
• BlackRock Debuts BITA Bitcoin ETF, Trading Partial Upside for Double-Digit Yield: Decrypt
• STRC at all-time low as Strategy loses 40 years of dividend coverage: Protos

Trakx CTIs Performance

Sources: Coingecko and AlphaVantage

*Return of bitcoin is calculated since 01/05/2020, while CTIs performances were calculated since their respective launch date.
**Includes simulated performance.
***The risk signal is determined according to the historical volatility level, the higher the riskier.

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Disclaimers: No Investment Advice. Index returns and statistics are for illustration only. Index returns do not reflect any transaction costs or expenses. Past performance does not guarantee future results. The information provided in this newsletter does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the newsletter content as such. Trakx.io does not recommend that any cryptocurrency should be bought, sold, or held by you. Readers shall conduct their own due diligence and consult their financial advisors before making any investment decisions.