Key takeaways:
- Bitcoin remains under pressure from the $2.1 billion outflow from ETFs in June and a continuing discount to global Bitcoin/USDT pairs.
- Strategy’s STRC stock is showing weakness, highlighting growing concerns about monthly dividend obligations and share dilution.
The US stock market fell on Wednesday after President Donald Trump declared that the memorandum of understanding with Iran was not final. Investors fear that oil flowing through the Strait of Hormuz will not clear quickly, adding to pressure on inflation. Are the stock market and Bitcoin (BTC) at risk?
The United States and Iran are expected to formally sign the agreement on Friday, beginning a 60-day negotiation period. On Wednesday, Trump said the agreement should satisfy markets and that oil prices could fall. However, the US president threatened further bombings if Iran “does not behave”.
Yield of US 5-year treasury bonds vs. Brent crude oil, USD. Source: TradingView
Brent crude oil fell to a 100-day low, but investors doubt fuel prices will continue to weigh on markets for long. The yield on US Treasuries remained at 4.16%, unchanged from two weeks earlier. Investors are less confident in the U.S. Federal Reserve’s ability to quickly cut interest rates, thus demanding higher yields on government bonds.
Impact of higher inflation amid frail institutional demand for Bitcoin
U.S. retail sales data released Wednesday showed a 6.9% augment from May 2025, but the augment likely reflects higher costs of goods such as fuel. In parallel, the first meeting of the Fed Committee chaired by Chairman Kevin Warsh was held on Wednesday. The decision to keep interest rates steady was largely expected, but investors will be trying to discern Warsh’s views and personal credibility.
Nasdaq-100 futures (left) vs. Bitcoin/USD (right). Source: TradingView
The tech-heavy Nasdaq-100 index was trading 2% below its all-time high, while Bitcoin has failed to stay above $80,000 since mid-May. Bitcoin trader skepticism is partly due to the lack of inflows into spot Exchange Traded Funds (ETFs) and Coinbase’s lack of premium to international exchanges, which signals frail demand from institutional investors.
Coinbase Bitcoin USD vs. international USDT prices. Source: TradingView and Cointelegraph
The USD Bitcoin price on Coinbase has been trading at a discount compared to international USDT-based exchanges for the past five weeks. Meanwhile, US-listed Bitcoin ETF spots have seen Net outflows of $2.1 billion so far in June. The recent weakening of preferred perpetual equity strategy Stretch (STRC US) has further fueled negative sentiment.
Related: Bitcoin exceeds 67 thousand dollars after the US-Iran peace agreement: is it a bull trap?
The preferred strategy is perpetual equity Stretch (STRC US). Source: TradingView
STRC offers holders a rate of return of 11.5%, but novel shares can only be issued at a fixed price of $100. As a result, Strategy has less ability to pay its $142 million cash dividend each month, forcing MSTR holders to be diluted by issuing more shares or reducing its USD cash reserves, which currently stand at $1.1 billion. The aggregate value of preferred shares issued by Strategy is $15.5 billion.
There is no evidence that the Strategy will do so forced to sell some of his Bitcoins reserves in the near term, but STRC’s price weakness reflects low confidence in the company’s financial leverage. Even if Bitcoin flows into institutions resume, investors fear that a US-Iran deal may not materialize and therefore a sustained rise to $80,000 may take longer.
