The foreign exchange markets might be sleeping on some serious risks. According to recent analysis, G-10 currency traders are likely mispricing what analysts call "tail risks"—those black swan events that hit hard but catch everyone off guard. Here's the thing: when market volatility drops to historically low levels, hedging costs plummet too. Sounds great on paper, but it creates a dangerous illusion of safety. Traders and institutions get comfortable, lower their guard, and suddenly everyone's exposed to the same move when it finally happens. Geopolitical tensions aren't exactly easing up either. From trade wars to political standoffs, the macro backdrop remains fragmented and unpredictable. The current pricing in currency markets doesn't seem to be adequately reflecting these downside scenarios. This disconnect between perceived stability and actual underlying risks is the kind of setup that typically precedes volatility spikes. Worth keeping an eye on if you're managing exposure across markets.