ARP's Crypto Digest

General Digital Asset Market View:

Bitcoin Spot ETFs saw strong institutional flows over the past week, driven by continued demand. The largest net inflow came on May 2, totaling $674.9M, led by BlackRock’s IBIT. This followed a solid $422.5M on May 1, despite a minor outflow of $56.3M on April 30.

The only significant outflow occurred on May 6, at $85.7M, mainly due to Grayscale’s $89.9M in redemptions. However, inflows from Fidelity, Bitwise, and Ark helped offset the impact.

Momentum picked up midweek with $142.3M and $117.4M in inflows on May 7 and 8, respectively. The week closed with a strong $321.4M inflow on May 9, led again by BlackRock and Fidelity.

Flows continued to track Bitcoin’s breakout above $100K, reinforcing the role of ETFs as a key channel for institutional participation during rallies.

Macro:

U.S. stocks advanced last week as easing trade tensions and steady Fed policy boosted sentiment, with the central bank holding rates at 4.25%–4.5% and signaling potential cuts later this year. Looking ahead, markets will watch key inflation data (CPI, PPI), retail sales, and consumer sentiment, alongside major earnings from Walmart and Alibaba, for clues on economic direction and Fed policy.

More Crypto:

A year ago, USDT held 68.21% of the stablecoin market, with USDC at 21.14%.

Now, USDT has slipped to 63.64% while USDC has climbed to 25.68%. As new non-USD-backed stablecoins emerge and USDC gains influence, Tether’s dominance continues to erode.

Ethereum is flashing three rare signals not seen since its 25,000% rally in 2017: a Dragonfly Doji structure, a retest of long-term parabolic support, and the MVRV Z-Score dipping into the accumulation zone — all hinting at a potentially undervalued ETH.

Over 50% of cryptocurrencies have failed: out of nearly 7M tokens listed on GeckoTerminal since 2021, 3.7M are no longer trading.

Shockingly, 1.8M of those collapsed in Q1 2025 alone — nearly half of all recorded failures. This massive drop in survivability may reflect broader market instability, triggered in part by Donald Trump’s January 2025 inauguration.

What Happened This Week:

• US banks can handle customer crypto assets held in custody, regulator confirms.

• Bybit’s Bitcoin liquidity — measured by the 1% market depth — reached an average of $13 million per day by the end of Q1 2025, a full return to levels seen before the hack.

• Coinbase Acquires Deribit in $2.9B Deal.

• Solana Fixes Critical Zero-Day Bug That Could Enable Unlimited Token Creation.

• Ethereum Activates Pectra Upgrade on Mainnet.

What to Look Out For:

• Arthur Hayes Says Bitcoin Will Hit $1M by 2028 as U.S.-China Craft Hollow Trade Deal.

• Binance founder CZ says bitcoin could hit $500,000 to $1 million this cycle.

• BlackRock Met With SEC To Discuss Guidance On Staking In ETFs, Tokenisation, ETF Approval Standards And Options On ETFs.

• Meta in talks to deploy stablecoins after abandoning landmark crypto project.

What we enjoyed reading and listening to:

• Money, Blockchains and Social Scalability v2 — Link

• Big Idea #1: The Great AI Bottleneck is Data — Link

• Best of Real World Crypto 2025: Field notes — Link

• Catalysts for Adoption: The Next Decade in Privacy — Link

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