📊 This week on Market Pulse - Grab a front-row seat at US-China Trade Talks (Round 2)
Read the latest update from our Markets team.

🔷 Grab a front-row seat at US-China Trade Talks (Round 2)

🔹Crypto Overview

◾ Crypto markets entered a de-risking phase last week chiefly due to macro headlines and leveraged position unwind.

◾ $BTC traded between $100K–$107K, closing near $105K, down ~0.25%. $ETH and SOL fell ~1.25% and ~5.5%, with SOL underperforming. The TOTAL market cap dropped ~0.6%, while altcoins held up better, down ~0.8%.

◾ Mid-week saw a massive liquidation wave, wiping out nearly $1B in long positions across $BTC, $ETH, SOL, and DOGE. The cascade coincided with a high-profile X (Twitter) feud between Trump and Musk, which notably rattled investor sentiment and amplified volatility.

◾ Regulatory: UK Regulator FCA to lift ban on crypto ETNs for retail investors.

◾ Institutional Adoption:

▪️ JPMorgan embraces $BTC ETFs as loan collateral, showing positive momentum in TradFi banks’ stance on digital assets.

▪️ Robinhood finalized its acquisition of Bitstamp, signaling its strategic expansion into regulated crypto markets and enhancing its trading infrastructure.

▪️ Circle’s $1.1B IPO debut trading frenzy last week boosted crypto IPO prospects, and tech giants like Apple, X are rumored in early talks with crypto firms to add stablecoin payments.

▪️ Gemini Exchange reported to file confidentially with SEC for IPO.

▪️ Trump-lined ‘Truth Social’ files for Bitcoin ETF via NYSE Arca.

▪️ Michael Saylor teases fresh $BTC buy after $1B stock offering.

🔹 Bitcoin

◾ U.S. spot $BTC ETFs saw early-week inflows, yet significant on-chain liquidations triggered mid-week outflows, reflecting a common squeeze as leveraged longs were forced out. The week ended with net outflows of ~$132M.

◾ Notably, $BTC’s 7-day implied volatility fell beneath 40%, suggesting a reduction in neutral-market risk tolerance.

◾ On-chain data between 19 - 28 May of miner-to-exchange inflows >$1B per day signals short-term volatility ahead.

🔹 $ETH - Sustainable institutional inflows

◾ Open interest in $ETH futures surged by over 20% immediately post-Pectra upgrade, with $ETH perpetuals funding rates remaining positive, reflecting a continued bullish bias among derivatives traders.

◾ US Spot $ETH ETF recorded 15-day inflows streak accumulating to $837.5M inflows.

◾ $ETH’s ~41% monthly gain, significantly outpacing $BTC’s ~11% rise in May, combined with a dip in $BTC dominance (from ~65% to ~62%), served as a potential classic early-phase indicator for altcoin season, when broader altcoin performance typically accelerates following $ETH strength.

🔹 Other Crypto Takeaways

◾ AB (AB DAO): Binance Alpha debut on June 7 sparked a sharp rally of ~25%, driven by a promotional airdrop (~$9K per user) and trading incentives that boosted participation and on-chain momentum.

◾ SPX: rallied ~16.5%, continuing its bullish breakout above $1, fueled by a successful Layer-2 presale linked to Solaxy.

◾ INJ: rose ~11% ahead of the Injective Summit (June 26), as speculators positioned for product launches and announcements.

◾ HYPE: gained 3.7% on weekly momentum following 61% growth in May, supported by strong exchange fee revenue (~$64M) and bullish crypto options sentiment.

◾ SKY: jumped ~8% midweek after launching USDS staking rewards.

🔹 TradFi Overview

◾ Asia stock markets started the week on a stronger note as investors await US-China trade talks later today, China reportedly granted temporary approvals for rare earth export ahead of the meeting helped boost trade truce optimism.

◾ Investors are busy digesting the slew of macro data that came in Monday Asia Morning (China CPI shows deflationary pressures accelerate, China Exports slow as US Tariffs effect hits and Japan Q1 GDP contraction narrows).

◾ US stocks popped last Friday after non-farm-payrolls data came in better than expected. All 3 major indices closed at their highest level since February with S&P closing above 6,000 for the first time since 21 Feb, fueled by tech stocks surge. Tech strength continues in Asia hours with Baidu and Alibaba leading the gain.

◾ Dip buyers also piled in on Tesla as it rebounded over 3% since the plunge on Thursday after Trump-Musk break up.

◾ USD eases, while treasuries dropped across the curve with 2Y yields touching over 4%.

◾ Street is now trimming bets on Fed rates cut this year, now pricing in a 63.8% chance of rates cut in September vs 90% chance earlier last week.

◾ Safe-haven assets like gold remained low after a sell-off.

🔹 Outlook for the Week

◾ All eyes on US-China trade talks held in London on Monday

◾ Key Macro Data:

▪️ US: Core CPI and PPI, UoM Sentiment

▪️ EMEA: UK Labour Market Report, Spending Review and GDP. EU Industrial Production and Trade Data.

▪️ Apple Worldwide Developers Conference.