The Federal Reserve's Decision and Its Hawkish Surprise
The newly installed Federal Reserve Chair, Kevin Warsh, presided over his first Federal Open Market Committee (FOMC) meeting and announced that interest rates would remain unchanged. In his words, the committee is committed to delivering price stability, and the message from the FOMC members was described as both unambiguous and unanimous.
Leaving rates unchanged was the expected outcome, and the vote on that decision was indeed unanimous among the committee. However, the surprise came in the tone. Despite the unanimous hold, the Fed came across as rather hawkish. As a result, the odds of the Fed actually hiking interest rates at some point in 2026 surged to 49%. This shift in probability is rooted in the fact that, while all members agreed to hold rates steady for now, nine out of the 18 officials signaled that a rate hike in 2026 remains a genuine possibility.
The timing of these decisions matters because there are only four FOMC meetings left in 2026 — scheduled for July, September, October, and December. With a limited number of meetings remaining, every signal carries extra weight.
Geopolitics, Oil, and the Inflation Picture
Layered on top of the monetary backdrop is a developing geopolitical situation. A supposed peace deal is in motion, and oil prices have been falling, dropping to $76. The agreement could be signed as early as immediately, though the expectation is that it will be signed on Friday.
The United States released a 14-point agreement with Iran outlining what the deal is expected to contain. The US made several concessions, including unfreezing Iran's assets and lifting the naval blockade, among other measures. Iran, in turn, made concessions of its own: ensuring that the Strait of Hormuz is returned to pre-war traffic levels within 30 days, and reiterating that it will never produce nuclear weapons going forward.
Although oil prices are behaving as though the war is genuinely winding down, the situation remains volatile because of shifting political rhetoric. The deal was characterized as not final until it is truly final — described instead as a memorandum of understanding. The stated position was blunt: if the terms are not satisfactory, or if Iran does not behave, military action would resume, with bombs dropped "right smack in the middle of their head."
This creates a fascinating tension between two markets sending opposite signals. The broader market is acting as though a rate hike is coming, pricing in a hawkish stance. Meanwhile, the oil market is acting as though the Strait of Hormuz will reopen — which would mean inflation comes down. If oil-driven inflation subsides, the Fed could actually pivot from hawkish to dovish before 2026 ends. In other words, the prevailing consensus about what comes next in 2026 may turn out to be entirely wrong.
Reading Warsh's Strategy
The interpretation offered here is that Warsh is playing a deliberate game. He is keeping the more hawkish "bears" on the committee from forcing a hike, allowing the temporary oil-price spike caused by the Iran situation to subside, so that he can ultimately cut rates lower later. The argument is that Warsh clearly does not want to hike.
To achieve this, he deliberately dropped forward guidance — a move intended to stop the other Fed governors from generating fear, uncertainty, and doubt (FUD). By declining to commit to a path, he keeps every option open, even as soon as the next meeting. In his own framing, inflation is a choice — something he has argued for years — but he refused to give any forward guidance about the Fed's next move, noting only the good news that the committee would be meeting again in six weeks.
Warsh also admitted that today's macroeconomic conditions are restrictive. The expectation is that forward expectations will move aggressively once oil comes down, because falling oil means falling inflation. The conclusion drawn is that Warsh is not Bitcoin's enemy.
Is Michael Saylor in Trouble?
If the Fed isn't the threat to Bitcoin, attention turns to Michael Saylor. There has been "June gloom" surrounding his company's product, Strike, which is currently offering 11.5% dividends. Strike is designed to maintain a price of around $100 at all times. It has fallen short of that target before, then recovered. At present, it is again falling short, raising the question of whether it will pop back up. Bears argue that Michael Saylor will fail and drag Bitcoin down with him.
The counterargument, articulated by Anthony Scaramucci on CNBC, is that investors should not be fooled by the bears. Is Bitcoin still worth owning? Yes — Scaramucci says he still likes it and owns a lot of it. When does he expect Bitcoin to rally? He believes Bitcoin starts to rally late in the fourth quarter of 2026 and into early 2027.
Is Michael Saylor in trouble? Scaramucci's direct answer is that Saylor is definitely not in trouble. The reasoning is detailed:
- A fortress balance sheet. Understanding the mechanisms of that balance sheet reveals that Bitcoin can fall a great deal further while leaving Saylor virtually untroubled.
- Buying back converts. Saylor recently bought back some of his convertible notes, which removes that piece of risk from the table — something he had probably been a little worried about.
- A deep capital pool. He has a very deep pool of capital he can access.
- Healthy NAV premium. He is still trading at roughly a 1.2 to 1.3 net asset value (visible via the strategy app, comparing the stock price to the value of his Bitcoin holdings). That premium provides the necessary arbitrage for investors to remain comfortable with the trade.
The Four-Year Cycle and Market Apathy
Scaramucci frames the current environment through the lens of Bitcoin's historical four-year cycles, drawing on 38 years of experience as an investor. What is happening now, he argues, is very consistent with that cycle, occurring just a few months after the most recent halving. The next halving is expected roughly in April 2028. Historically, the recovery in Bitcoin begins about nine months before a halving — which is precisely why he projects a rally beginning late in Q4 2026 and extending into early 2027.
He also characterizes this as a shallow cycle. Bitcoin typically falls between 60% and 70% from its high, but this time it is down only roughly 50%. While some traditionalists argue that this means Bitcoin still has further to fall, Scaramucci attributes the cushioning to institutional buying at the ETF level and broader retail buying through ETFs.
Crucially, he points to sentiment indicators. The Relative Strength Index (RSI) is at an all-time low for Bitcoin, apathy is pervasive, and no one seems to care about it anymore — Google searches for Bitcoin are way down. Combined with a thin market, these conditions are significant. Bitcoin's total market capitalization is now only about the size of Micron Technology, meaning even a tiny bit of demand can move the price substantially. He cites the recent move from 61 to 65 (briefly touching 67 before backing off) as evidence. He is candid that he is "talking his book" since he owns a lot of Bitcoin, but he maintains that Bitcoin is right where you would expect it to be in the four-year cycle.
This dovetails with the classic investing maxim: buy when there is fear in the air. Since the "10/10 massacre" of last October, there has been only a single day on which the fear and greed index registered above 51. Most of the past eight months have been spent in extreme fear territory. If this isn't bear-market sentiment, the argument goes, then nothing is. The encouraging interpretation is that the market is already eight months into this phase — the advice being to hold on tight. The open technical question is whether old resistance will turn back into support, or whether current support fails and Bitcoin makes a lower low.
Regulatory Tailwinds: The Clarity Act
On the policy front, Senator Bill Hagerty expressed hope that the Clarity Act will be signed into law before the end of July, stressing that it is critical to get this done to maintain America's innovation edge. The Clarity Act is intended to create the kind of certainty necessary to bring the entire digital asset framework into full-blown opportunity in America.
Hagerty connected this to the earlier Genius Act, which he authored and which brought America into the digital payments arena. He argued that, thanks to that legislation, America now has a reserve digital dollar backed dollar-for-dollar by short-term US Treasury securities, helping the US continue to lead as the world's reserve currency. As the industry moves more broadly into the digital asset arena, those assets carry far more varied uses. On the legislative process, the realistic expectation is that the Clarity Act will become more of a focus after the Fourth of July recess, but with the stated hope of completion before the end of July.
Long-Term Price Forecasts from Standard Chartered
Looking out four to five years, the finance giant Standard Chartered believes it will pay to be a bull. By 2030, their forecasts are striking:
- Uniswap: from less than $3 today to $100.
- Ethereum: from less than $2,000 today to $40,000.
- Bitcoin: from $63,000 today to half a million dollars.
These projections come from Jeffrey Kendrick, Standard Chartered's global head of digital asset research and former head of Asia FX and rates strategy at Morgan Stanley. His long-term targets are $500,000 Bitcoin and $40,000 Ethereum by 2030 — roughly a 20x for Ethereum.
How does Ethereum reach $40,000, and why will it outperform Bitcoin? Kendrick's thesis centers on traditional finance ("tradfi") getting involved. As tradfi becomes comfortable building on Ethereum, more activity should translate into a higher token price. He frames this in terms of the ETH/BTC cross, which currently sits at roughly 3% (0.03). He expects that ratio to climb to 4% this year — meaning if Bitcoin is at $100K, Ethereum would be at $4K by the end of 2026. Extending to his long-term view, $500,000 Bitcoin and $40,000 Ethereum by 2030 represent not only a massive absolute upside (roughly 20x by the end of 2030) but a massive relative outperformance for Ethereum.
The driver behind that outperformance is use cases. Kendrick argues that nearly all of the use cases under discussion will happen on Ethereum in the first phase. Later on, activity could migrate to other chains, but the first wave is most likely to be Ethereum-based.
The Bottom Line
The overarching message is that the prevailing bearish narratives may be misreading the situation. The Fed's hawkish posture could flip to dovish as oil-driven inflation recedes, Michael Saylor is structurally far more resilient than the bears suggest, sentiment is at apathetic, fear-soaked extremes that historically precede recoveries, regulatory clarity is approaching, and respected long-term forecasts point to dramatic upside. Against the headline fear that "the Fed is about to blow up Bitcoin," the case made here is that the crowd may simply be wrong about what comes next.
