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What you need to know

Talks in Oman wobbly but likely remain on track

Yesterday, Axios, citing anonymous U.S. officials and perhaps reading into Secretary of State Marco Rubio’s remarks about the difficulty of dealing with Iran, reported that the U.S.-Iran talks scheduled for Friday had been canceled. Roughly an hour later, Iranian Foreign Minister Abbas Araghchi said on X that the talks were still on and would begin at 10:00am in Oman. Major media outlets, including Axios, are now reporting that the meeting will proceed on Friday, although the White House and the State Department have not issued a formal confirmation.

Iran says the talks should focus only on the nuclear file. Iran’s stock of highly enriched uranium is now believed to be buried after U.S. airstrikes in June last year.

The U.S. has so far argued that other issues, especially missiles and support for regional proxy groups, should also be on the table. Israel has been pressing Washington to make missile constraints a priority. The agenda, however, remains uncertain.

Meanwhile, the U.S. military buildup in support of U.S. Central Command’s area of operations continues. Since 15 January, up to 108 flights, using C-17s and C-5s, have moved from the continental United States and U.S. bases in Japan, via Europe, to the Middle East and Diego Garcia.

Over the past day, flights have reportedly originated mainly from Robert Gray, Biggs, and Roosevelt Roads. Movements from Army airfields are likely transporting air defense systems such as PATRIOT and THAAD. Flights from Roosevelt Roads may be supporting the deployment of Vermont Air National Guard F-35As to Jordan.

There are now three U.S. Air Force E-11A Battlefield Airborne Communications Node aircraft in the Middle East. Only one was used during Operation Midnight Hammer, the U.S. operation in June last year that destroyed parts of Iran’s nuclear-enrichment infrastructure. The platform functions as an airborne communications relay, linking forces on the ground and in the air with each other and with higher headquarters.

Birthplace of civilization

Israel’s security cabinet to meet on short notice

Israel’s security cabinet is due to convene at 4 p.m. in Tel Aviv today, according to reports carried by The Times of Israel. Ministers were reportedly summoned at relatively short notice and were not told what the meeting would cover, an unusual combination for a forum reserved for the most consequential security decisions.

The timing has prompted speculation that Prime Minister Benjamin Netanyahu wants to align Israel’s posture ahead of fast-moving regional diplomacy and military planning. As noted above, Oman is expected to host U.S.-Iran talks on Friday, focusing Israeli attention on the scope of any understandings with Iran. Separately, the Prime Minister’s Office said this week that a meeting between Netanyahu and Steve Witkoff had concluded, reinforcing the sense that the diplomatic track is intensifying, with the threat of military action looming in the background.

The ultimate complex system

Crypto rout rattles wider markets

Market volatility has spiked, apparently driven by a sharp sell-off in Bitcoin and other crypto-assets, alongside renewed anxiety about the risk of conflict with Iran.

Bitcoin is normally marketed as an inflation hedge, but in practice it has behaved more like a highly speculative asset that tends to move with broader risk appetite.

About $130bn has been wiped from the crypto market’s total capitalization over the past day.

Bitcoin has fallen below $70,000.

Tether (USDT), the stablecoin designed to trade at $1, slipped to $0.9980, its weakest level in more than five years. Some analysts warn that a larger break could follow, which would strain market liquidity given USDT’s central role in crypto trading volumes.

One of the largest exchanges, Binance, also appears to be under pressure. Commentators point to heavy net outflows over the past week, depressed usage relative to recent years, and an increasingly litigious posture by the firm and its founder, Changpeng Zhao, toward critics.

Some sovereign holders are also turning into sellers. Bhutan is reported to be selling Bitcoin; Bhutan and El Salvador are among the few national governments that publicly embraced large Bitcoin positions.

In Washington, the mood is unsympathetic. A U.S. senator publicly asked whether the Treasury could “bail out Bitcoin.” Treasury Secretary Scott Bessent replied that the government has no authority to do so.

What to watch: Further stress at major market utilities such as large losses at MicroStrategy (the company with the largest private holdings of Bitcoin), bankruptcy risk at Binance or Coinbase exchanges, or a deeper de-pegging in USDT that disrupts settlement and liquidity across exchanges. Political risk also bears watching, including the possibility that El Salvador trims its holdings under pressure.

U.S. tech rout deepens as crypto slump and Iran jitters unsettle risk assets

U.S. technology shares sold off heavily on 4 February, as investors pulled back from crowded “AI trade” positions and cut exposure to riskier assets more broadly. The day’s biggest move came in semiconductors, after AMD fell about 17% following a weak revenue outlook that revived doubts about how readily it can keep pace with Nvidia in data-center AI.

The slump spread quickly across the usual beneficiaries of the AI boom. Palantir fell about 14%, Micron Technology about 12%, Broadcom about 8%, and Tesla and Intel about 5% each, as traders rotated away from richly valued growth stocks. Meta Platforms and Alphabet also slipped, while International Business Machines drifted lower.

The broader tape was consistent with a “risk-off” session: the tech-heavy Nasdaq fell more than the S&P 500, even as the Dow rose. That pattern often reflects a shift toward cheaper, more defensive sectors. A fall of roughly 2.2% in the Nasdaq 100 would be consistent with the day’s move in large-cap growth, even if some widely reported closes focused on the Nasdaq Composite.

Two forces reinforced the sell-off. First, the market’s AI story is moving from “growth at any price” toward harder questions about margins, competition, and how quickly new tools will commoditize software and services. That has made earnings guidance unusually powerful, particularly for chipmakers and high-multiple data firms.

Second, crypto weakness has added to the deleveraging. When Bitcoin and related assets drop rapidly, it can sap liquidity and confidence across other speculative corners of the market, especially among traders who run similar funding and risk limits for tech and crypto exposures.

Geopolitics has been an accelerant rather than the core driver. Rising U.S.-Iran tension can push oil higher and dampen appetite for volatile assets. Still, Wednesday’s price action had a clear near-term catalyst in chip guidance, layered on top of a broader unwind of crowded positioning.

Move fast and break things

Supreme Court lets California’s Proposition 50 map stand, for now

On 4 February, the U.S. Supreme Court declined to pause California’s new congressional map under Proposition 50 while appeals proceed, leaving the lines in place for the 2026 cycle. The order was issued without explanation, and no justice publicly noted a dissent.

Proposition 50, approved by voters on 4 November 2025, temporarily shifts congressional redistricting from the independent commission to a legislature-enacted map through 2030. Supporters call it a partisan counterpunch after mid-cycle map changes elsewhere, while opponents argue that some districts were drawn with race impermissibly in mind.

The immediate effect is procedural, but meaningful: candidate filing, primaries, and campaign planning can proceed on the new boundaries, rather than under the old commission map. Analysts expect the revisions to place several Republican-held seats in closer contention, intensifying the national battle for control of the House.

The case is not over. By refusing emergency relief, the Court has not ruled on the merits; it has merely allowed the map to operate while the appeal runs its course. The dispute will now move through the normal appellate process, with the Supreme Court retaining the option to consider the case later.

Instability from Sahel to Horn of Africa amid state fragility, Russian interference, & Islamist insurgencies

Jihadists push violence deeper into western Nigeria

Suspected fighters from Jama’atu Ahlis Sunna Lidda’awati wal-Jihad (JAS), a Boko Haram faction, raided the village of Woro in Kwara State in western Nigeria, killing dozens of civilians. Local reporting suggests the final death toll might well be higher.

The attack took place less than 4 kilometers (2.5 miles) from Nuku, where Jama’at Nusrat al-Islam wal-Muslimin (JNIM) claimed its first attack in Nigeria in October 2025. The proximity adds weight to earlier indications that the groups’ operating areas overlap in this corridor. That, in turn, raises the possibility of tactical coordination, or at least a de facto non-aggression arrangement.

The killings in Woro also resemble attacks reported in recent weeks farther north, around Papiri in Niger State. The pattern points to continued southward movement by the Sadiku-aligned JAS faction toward the Kainji reserve, where JNIM is assessed to have more established networks and longer-term bases.

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