Bitcoin fell below $73K
There’s never a dull moment onchain. Here’s what you need to know this week:
BTC fell below $73K. Plus: HYPE ETFs and tokenized stocks are rallying and why tokenization IPOs could become a $1 trillion market.
What’s next for bitcoin? Top analysts on why BTC could be poised for a breakout.
Who will win major basketball, hockey, and tennis matchups? Find out who prediction market traders have picked.
MARKET BYTES
Why crypto prices are struggling for the second week in a row
After trading above $82,000 earlier this month, bitcoin, alongside the greater crypto market, has stalled in the last couple of weeks. This week, BTC dropped below $73,000, ETH fell under $2000, and crypto’s total market cap dipped past $2.5 trillion.
The main trigger has been uncertainty created by the Iran conflict, which has spiked oil prices and inflation and increased fears that central banks will be forced to raise interest rates. But those worries have seemed to impact crypto markets — and especially crypto ETFs — more than stocks, which have risen close to all-time highs as enthusiasm grows for companies connected to AI.
So what could kick off crypto’s next big rally? And how high could prices go? Here’s answers to those questions and more news you should know….
Hyperliquid ETFs are surging even though billions of dollars just flowed out of other crypto ETFs
One major factor weighing on crypto markets over the last couple of weeks has been sinking demand from institutional traders for spot bitcoin and ETH exchange traded funds (ETFs).
Over the last two weeks, crypto ETFs have shed more than $2.5 billion, with the vast majority accounted for by funds holding bitcoin and ether. "The sharp declines reflect a risk-off move driven by profit-taking after recent highs, rising Treasury yields, and broader macro caution amid geopolitical headlines," Nick Ruck, director of LVRG Research, told the Block.
But several funds holding altcoins — including XRP, Solana, and Hyperliquid — all saw gains last week.
Of those, Hyperliquid (HYPE) funds were the big winner, with more than $100 million in inflows in their first ten days since launching. Hyperliquid is a decentralized trading platform that has surged in popularity since the beginning of the Iran conflict, with investors using it to trade crypto perpetual futures, tokenized pre-IPO stocks, oil and precious metals, and much more.
Organic chemistry… “[21 Shares’] Hyperliquid ETF is growing volume each day since launch in the tens of millions now … which is a really good sign of organic interest,” noted Bloomberg ETF analyst Eric Balchunas.
Tokenized stocks are the fastest growing asset class on Ethereum
According to a new report, tokenized stocks are the fastest growing asset class on the Ethereum blockchain.
“The growth in tokenized stock offerings reflects expanding demand for blockchain-based access to traditional equities,” notes the Defiant. “These instruments allow investors to hold fractional ownership of stocks as ERC-20 tokens on Ethereum, enabling 24/7 trading and programmable settlement distinct from traditional market hours and settlement cycles.”
Five-year plan… New companies involved in the tokenization push could grow into a $1 trillion public market over the next five years, according to a new report from global investment firm Jefferies. As CoinDesk reports, “Jefferies said conversations with clients showed investors are becoming more convinced that blockchain technology is moving beyond experimentation and into core financial infrastructure.”
CRYPTO BALL
What could spark crypto’s next big rally?
While stocks are trading near all-time highs, bitcoin’s price action has been muted, with low volatility and rising uncertainty due to the Iran conflict and other factors contributing to BTC’s inability to sustain a breakout.
But periods of near record-low volatility like this one often precede major price moves … in either direction. Could BTC’s breakout be in the cards?
Here’s why some analysts believe an end to bitcoin’s period of underperformance could be near…
Why bitcoin could be poised to outperform stocks again
Until early May, Bitcoin had underperformed the S&P 500 for 142 days — the longest such stretch in history, according to Mark Connors, former global head of portfolio management at Credit Suisse. Since then, it's broken out of that underperformance phase, Connors says, and is showing signs of shifting from a consolidation phase “into an outperformance phase.”
The current macroeconomic environment, which is mired in uncertainty around geopolitical tensions, interest rates, and inflation, could become a boon for BTC, argues Connors.
Bond markets, which are often considered a safe haven asset, are under pressure due to interest rates remaining elevated. And high oil prices are contributing to inflation, with Connors saying that the “only way to punch through that inflationary pressure is through technology.”
Connors compared the current moment to the era after the pandemic began in 2020, when gold initially surged before bitcoin began a period of significant outperformance. “Gold has had its run,” he said. “Bitcoin is now on its resurgence.”
Options traders are betting on higher prices for bitcoin
Options markets can be viewed as indicators for market sentiment. And right now, options traders seem to have a slightly bullish outlook. In options trading, traders can buy a “call” if they believe prices will be higher by a certain date or buy a “put” if they believe prices will be lower by a certain date. Currently, more than $3.4 billion out of the $6.3 billion in options contracts expiring on May 29 on Deribit were calls, reflecting a modestly bullish outlook.
Last week, traders appeared to be positioning for a price breakout, with calls for BTC hitting $82,000 by May 29 being the most popular options trade on Deribit May 21. Now with expiry days away, traders are piling into almost three times as many puts, with the most popular put option overall being for BTC to stay below $75,000 by May 29.
Analysts believe that it is unlikely for BTC to make any major moves until this tranche of options expires. When so much capital is concentrated on options calls so close in value, “traders are incentivized to keep price action pinned between these levels as expiry approaches, contributing to the current period of compressed volatility,” says Coindesk.
What catalysts could trigger the next rally?
While bitcoin still sits nearly 40% below last fall’s all-time high, analysts are increasingly confident that the bottom is in, and BTC could top $100,000 again by the end of the year. Christopher Jensen, the director of digital asset research at Franklin Templeton, has backed a $100,000 price target for bitcoin by the end of 2026, while Bernstein Research has previously said BTC won’t fall below its $60,000 low from earlier this year and should set new highs by the end of December. For both, rising institutional demand is a key factor for bitcoin’s potential success.
(When do prediction market traders think bitcoin will surpass $100,000 again? The biggest group, 31%, says before the end of the year, with another 15% saying before October.)
For it to happen, though, a few potential catalysts would likely need to come to fruition. The biggest is the passage of the CLARITY Act, a landmark piece of crypto legislation that is awaiting a full Senate vote. If it becomes law, analysts believe it could usher in trillions of dollars of institutional capital into crypto markets. A resolution to the Iran conflict, which has led to subdued risk sentiment, could also prove a boon for bitcoin.
PREDICTION MARKETS
Sports roundup: who will win major basketball, hockey, and tennis matchups?
Pro Basketball Playoffs: Oklahoma City vs San Antonio Game 6
60%, San Antonio
What markets say: It’s been a back-and-forth series, and traders are expecting Victor Wembanyama and San Antonio to send it to a Game 7 with a win at home tonight. San Antonio has repeatedly been the underdog in games played in Oklahoma City, but the favorite in matchups on their home turf. Traders have faith in San Antonio to save their season, and force one more game back in Oklahoma City.
What analysts say: “Time and time again Wembanyama has responded to adversity defiantly. Expect him to rise to the challenge tonight on his first career elimination game.” – SB Nation
Pro Hockey Playoffs: Montreal vs. Carolina Game 5
Carolina, 69%
What markets say: Traders see Montreal as the underdogs, with their season on the line in Game 5 of their series against a Carolina team that has dominated the playoffs so far. Montreal has handed Carolina their only playoff loss in this series, but traders aren’t assigning a high probability to Carolina dropping another game.
What analysts say: “It'd be human nature at this point for the Canadiens to wonder how they can win one more game, let alone three in a row, against a team that is playing at its best, one that has swallowed them whole for three straight games and has won 11 of 12 in these Stanley Cup Playoffs.” – NHL.com
French Open: Men’s Winner
Alexander Zerev, 34%
What markets say: Zverev had just an 8% probability before the heavy favorite Jannik Sinner lost his second round match unexpectedly after struggling in the Paris heat. Within hours, his chances multiplied and he is now considered the favorite, slightly ahead of 24-time Grand Slam champion Novak Djokovic.
What analysts say: “Hard to overstate the implications of Sinner losing. He had been the biggest favorite at a men's Grand Slam since Rafael Nadal at the 2009 French Open, making the event seem like a foregone conclusion. By losing suddenly we're in a land of opportunity.” – The Athletic
French Open: Women’s Winner
Iga Świątek, 28%
What markets say: While Aryna Sabalenka is the No. 1 ranked woman in tennis, traders believe Świątek has the slight edge, likely due to her dominant history on clay court tennis matches. The two have been within a few percentage points of each other all week, though, with traders flipping between them as favorites.
What analysts say: “Despite [early season] struggles, Roland Garros remains the tournament most closely associated with Świątek’s legacy, where she has consistently produced her best tennis under pressure. She captured the title in 2020, 2022, 2023, and 2024, establishing herself as the “Queen of Clay.” – Last Word on Sports
TOKEN TRIVIA
How much is the tokenized Pokémon card market worth?
A
$1.4 million
B
$4.4 million
C
$7.4 million
D
$10.4 million
Find the answer below.
Trivia Answer
C
$7.4 million
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