Now or Never for Clarity

Trump’s Hormuz deadline expires at 1pm BST today. A 45-day ceasefire is being whispered. Bitcoin has been well bid on ceasefire hopes, trading at $69k. But the week’s most important story may be quieter: the Clarity Act is approaching a do-or-die moment, a pivotal NFP print came in at nearly three times consensus, and Friday brings CPI, Michigan sentiment, and inflation expectations, the number the Fed watches most closely.

Geopolitics: Deadline Day

Trump’s self-imposed deadline for the Strait of Hormuz to reopen expires at 1pm BST today. Over the weekend, Trump posted a tweet threatening significant escalation from tomorrow if the straits remain closed, a post we had to verify was not from a parody account. Simultaneously, there is a quiet drumbeat of talks around a 45-day ceasefire. Bitcoin has been well bid in recent sessions, largely on ceasefire optimism rather than any fundamental change. Hilbert’s view: No specific insight on the geopolitical outcome. Watch and wait. The ceasefire rumour is the market’s near-term driver for BTC; an escalation beyond the rhetoric is the tail risk. TradFi is expected to take its direction from geopolitical developments over the next few days.

Clarity Act: Now or Never

The Do-or-Die Window John Deaton (the candidate running against Elizabeth Warren) has made the stakes explicit: if the Clarity Act does not pass before the summer recess , it will not pass at all. When Congress returns from recess, the November midterm campaign will be in full swing, and Elizabeth Warren will likely be back on the banking committee. That is the death knell for any meaningful crypto legislation in this cycle. The Tillis·Brooks Amendment Late in March, Senators Tillis and Brooks agreed on a bilateral amendment that provides new language for the Clarity Act. That language was distributed to major industry participants late last week. The early read: it is a compromise that tilts toward the banks rather than stablecoin issuers . Circle and Coinbase who share a revenue arrangement, have already come out publicly to say the current language is “unacceptable.” Hilbert reads this as potential brinkmanship; the final language is not yet settled. The Stablecoin Yield Controversy The central flashpoint: the current draft language would not allow stablecoin issuers to pay yield for simply holding stablecoins. This directly attacks the economics of platforms like Circle’s USDC and Coinbase’s model. There is also a contentious ethics section. The debate reflects a fundamental tension: stablecoin growth at scale could represent deposit flight from the banking system, which would undermine the banking multiplier and potentially slow economic activity. The $500bn threshold: Approximately $500bn is cited as the level at which deposit flight into stablecoins becomes a systemic concern for US banking. Stablecoin issuers would however need to buy US Treasury yields, which would push rates down, a partial offset. But loss of the banking multiplier on $500bn of deposits is a significant drag on credit creation and economic activity. Polymarket Odds & Timeline Indicator Status Polymarket odds (Clarity passing) 65% (up from 54% last week) Banking committee markup Second half of April Vote (after markup) Pending markup outcome Deadline (per Deaton) Before summer recess 2026 If missed Elizabeth Warren returns to banking committee; legislation dead Source: Hilbert Trader Call, 6 April 2026

Last Week’s Data: US Strength, Europe Softening

US Data - Near-Perfect for the Fed Indicator Actual Expected Read Non-Farm Payrolls 60,000 Massive beat 3 x consensus 178,000 Average Hourly Earnings 3.5% 3.7% Miss wages cooling Retail Sales Beat Strong consumer ADP Employment Beat Labour market firm ISM Beat Business activity solid Source: Hilbert Trader Call, 6 April 2026 The combination of a 178k NFP print against 60k expected (nearly three times consensus) and falling average hourly earnings is close to ideal for the Fed: a strong labour market with no wage-driven inflation pressure. This removes any urgency to act. Fed fund futures have responded accordingly, April is now priced at 99.5% hold. Russell Thompson - CIO, Hilbert Group “Strong labour market, low wage inflation that equates to nothing really to be done by the Fed at the moment. And you can see that in the Fed fund futures.” UK & Europe - Rate Hike Expectations Unwinding Indicator Result Implication UK Sterling retail sales Missed Consumer weakness; short Sterling thesis intact European CPI Missed Rate hike expectations backing out in Europe Source: Hilbert Trader Call, 6 April 2026 Hilbert’s long-held view, that European and UK rate hikes are off the table, is being vindicated by the data. Both UK retail sales and European CPI missed expectations, reinforcing the growth-weakness story that makes hikes inconceivable. The short Gilts / short Sterling trade remains Hilbert’s top macro view.

Fed Funds & Rates

Meeting / Scenario Probability Hilbert View April FOMC hold Agreed 99.5% December no change Disagrees cuts coming 78.9% December hike ~9% Not happening December cut Firmly in this camp ~12% Source: CME FedWatch / Hilbert Trader Call, 6 April 2026 December pricing is now more normalised than in recent weeks, with the hike hysteria of late March largely unwound. At 12% for a cut, the market is still under-pricing Hilbert’s base case. We are firmly in the cut camp for December: Warsh’s disinflationary worldview, combined with the AI structural story and cooling wages, will ultimately deliver rate cuts before year end. Rates & Markets Snapshot Level Asset Change (w/w) 10-Year US Treasury 4.36% Flat 2-Year US Treasury 3.86% Flat 2s10s Spread 1bp flatter (unchanged) ~50bp Nasdaq ~24,000 +1,000 pts S&P 500 Up on week 6,600 Gold Up slightly $4,650 European Nat Gas (Dutch) ~50 EUR/MWh 5·6% on week US Dollar Index (DXY) Unchanged 100 Source: Hilbert Trader Call, 6 April 2026

Crypto: Calm Before a Catalyst

Volatility at Two-Month Lows The crypto volatility regime has shifted materially. Realized vol has dropped to 39%, implied is at 45%, giving just a 6-point premium of implied over realized. The DVol indicator, Deribit’s tracked crypto volatility measure, is at its lowest level sinc e . ETF flows are flat on the week, with absolute inflow/outflow numbers much lower than recent weeks. The market early February is in a holding pattern, waiting for a geopolitical catalyst. Derivatives: Skew Compression Current Level vs. Last Week Metric Realized Volatility 39% Down sharply (was ~53%) Implied Volatility (ATM) 45% Down (was ~63%) Implied Realized Premium +6pts Compressed (was +10pts) 5-delta Calls ~45% Flat “had a stroke” 5-delta Puts ~61% 16pt premium over calls DVol Indicator 2-month low Lowest since early February Source: Hilbert Trader Call, 6 April 2026 The put skew has compressed significantly from last week’s 36-point premium to a 16-point premium, still put-heavy, but far less extreme. The call side of the vol smile is completely flat at 45%, which is unusual and reflects a market that is neither positioned for upside gamma nor panicked about downside. A geopolitical resolution could reprice the call side quickly. Bitcoin Technical Levels Level Price Status Bid on ceasefire hopes Current price ~$69,000 First resistance $76,000 Near-term cap Key pivot (daily close needed) $80,000 Must close above this to turn bullish Bullish confirmation Break here = indicators flip bullish $84,000 Still holding Support (triple bottom) $62,000 Critical support $60,000 Lows from prior washout Break below $60k target $55,000 Next meaningful support Rapid move expected Break below $55k target ~$40,000 Source: Hilbert Trader Call, 6 April 2026 Stablecoin Ecosystem USDe yield: ~3.5% (unchanged) USDe TVL: $5.9bn USDtb TVL: Just under $1bn

Event Risk & Upcoming Calendar

Hormuz Deadline FOMC Minutes CPI + Michigan Inflation Expectations Today, 1pm BST Wednesday, 8 April Friday, 10 April Trump’s ultimatum expires. Ceasefire Market pricing 99.5% hold. Watch for rumours provide near-term BTC bid. any signal on rate path language, The week’s key data. Michigan inflation expectations are closely Escalation beyond rhetoric remains Warsh transition, and the Fed’s read the key tail risk for all risk assets. of the NFP / wages combination. tracked by the Fed and by Hilbert. Powell has said this is the series that would move the Fed to act. Also: CPI and Michigan sentiment on same day. Event Date Notes Today (Mon Apr 6) Hormuz deadline + PMI PMI releases despite US bank holiday Wednesday, Apr 8 FOMC Minutes 99.5% hold; watch rate path signals Thursday, Apr 9 PCE Inflation Fed’s preferred inflation measure CPI + Michigan Sentiment + Michigan Inflation KEY: Fed watches inflation expectations Friday, Apr 10 Expectations closely Second half of Clarity Act Banking Committee Markup Critical legislative milestone April Source: Hilbert Trader Call, 6 April 2026

Outlook

This week is pivotal on two fronts. First, the geopolitical: the Hormuz deadline expires today, and whether that produces escalation or the first steps toward a ceasefire will set the tone for risk assets for the rest of the month. A ceasefire unlocks significant BTC upside from $69k toward $76k, $80k, and beyond. Second, the legislative: Clarity Act odds are improving (now 65%) but the window is closing fast. Failure before summer means it does not happen. On the macro front, the US data backdrop is almost ideal for the patient Fed: strong jobs, cooling wages, solid consumer. Friday’s Michigan inflation expectations print is the one number that could move the needle, upside surprise would complicate the cut thesis; a stable or lower read would reinforce it. Hilbert remains firmly in the “cuts by December” camp. intended for professional and institutional investors only. Hilbert Group AB is listed on Nasdaq First North Growth Market.