The UAE is considering joining a US-led coalition to secure the Strait of Hormuz after a US military rescue operation in Iran. The odds for a ceasefire by April 7 have dropped to 1% YES, down from 12% last week.
Traders pushed odds lower across all related markets. The April 7 market fell to 1% YES, indicating a higher likelihood of military action over diplomacy. The April 15 market also dropped to 6% YES, showing pessimism for a near-term ceasefire. The April 30 market is now at 17.5% YES, down from 40% a week ago.
In longer-term markets, the May 31 market sits at 36% YES, dropping 10 points from 46% in the last day. This reflects skepticism about de-escalation within two months. The June 30 market saw a slight drop from 52% to 51.5% YES, indicating growing uncertainty.
Despite $3.8M in face value trading over 24 hours, actual USDC traded is $431K, showing the market can shift with modest orders. It takes $12,352 to move the April 7 market 5 points, showing some resistance to minor changes. The largest move was a 2-point spike in the April 30 market, highlighting ongoing volatility.
The UAE’s potential involvement raises the stakes for military conflict rather than peaceful talks. A ceasefire by April 7 at 1¢ per YES share would yield a 100x payout, but odds suggest this is unlikely. Significant diplomatic progress would be needed to change the current bearish outlook.
Watch for UAE announcements and UN Security Council actions, especially from Bahrain, for signs of international intervention or resolution proposals.
Markets Impacted
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