Last week, the cryptocurrency market moved in a 'weak at first, strong later' pattern. In the early week, altcoins including Ethereum experienced adjustments of several percentage points. With the Genius bill receiving final signature from the US President on the 18th, related cryptocurrencies could be interpreted as realizing profits due to the disappearance of positive news.
There was another profit-taking event. Bitcoin prices also experienced a significant adjustment. Bitcoin prices gradually showed weakness from the 24th and dropped to around $114,000 at one point on the 25th.
This was the result of the approximately 80,000 Satoshi-era Bitcoins that were ultimately sold in the market since July 4th. Galaxy Digital, which was entrusted with selling on behalf of the whale investor owning these quantities, released a press release on the 25th stating that they had sold everything in the market.
Fortunately, the market had confirmed the effect of the Genius bill before Bitcoin's decline. In the past week, approximately $4 billion worth of new stablecoins were issued. This inflow is interpreted as the promotion effect of newly launched bank/institutional stablecoins like 'USDtb' and existing mainstream stablecoins such as USDC/USDT. Cryptocurrencies related to this, such as Etena (ENA), saw prices surge by over 20%.
Traditional financial institutions like Bank of America, JP Morgan, and Citibank, which had been hesitant due to regulatory risks, are now actively preparing to issue stablecoins after the bill's passage. Big tech companies like Walmart and Google are also reviewing participation in payment and distribution. Particularly, JP Morgan has announced that they are considering a product that offers loans using Bitcoin and ETH as collateral from next year.
These news became a turning point for altcoins related to stablecoins, including Ethereum, which had been strongly adjusted at the beginning of the week. As of 11 PM on the 27th, Bitcoin prices have recovered to the level of $118,400 before Galaxy Digital's sale.
Market Adjusted After Genius Bill Passage... Revived by Stablecoin Effect
This summarizes the market flow from last week. Though it might seem monotonous in retrospect, the actual market volatility was a continuous movement difficult to predict.
The most interesting change is that the US spot ETF market, which had been driving Bitcoin price increases by injecting significant funds since May, recorded outflows for three consecutive days from the 21st. While this suggests a weakening of strong buying demand, there was no significant decline during that period. Long-term holders mostly continued holding, and short-term holders who bought after $115,000 were found to be taking profits.
In contrast, for Ethereum, which had been adjusting since the early week, strong buying was continuously recorded in the US Ethereum spot ETF. So, the flow of the spot ETF market, which had significantly influenced the prices of these two cryptocurrencies, moved exactly opposite to the price movement last week.
While $4.39 billion of funds were confirmed to have flowed into Ethereum-related financial products, analysts are urging caution, indicating signs that the market cycle peak is approaching. However, another group of analysts notes that Ethereum has surpassed Goldman Sachs in market capitalization and predicts a high possibility of breaking its all-time high.
The supply and demand battle between buying and selling was also fierce. For Ethereum, $1.3 billion worth of ETH is currently waiting to be unstaked. While it might seem like a massive 'selling bomb' will drop when unstaking is complete, the truth is different, as the quantity of ETH waiting to be newly staked is almost similar.
Ethereum looks slightly more positive compared to Bitcoin, as significant purchasing volumes from US-listed companies are expected this week. Last week, listed companies' Ethereum holdings surged to $3.7 billion, and Bitmain announced plans to invest over $2 billion in Ethereum by selling stocks. The crypto asset management company Bitwise expects institutional Ethereum investment to surge up to $20 billion.
Focus on EU Tariffs, FOMC, Cryptocurrency Policy Report
This week has several significant macroeconomic events lined up. First, the Trump administration is scheduled to meet with EU Commission President von der Leyen on the 27th (local time) to finalize tariff negotiations with the European Union. If the US concludes tariff negotiations with the EU favorably following the dramatic settlement with Japan last week, it could be a positive factor for the risk asset market.
On July 30th US time, or 3 AM on the 31st Korean time, the Federal Reserve will hold the July Federal Open Market Committee (FOMC) and decide on interest rates. The July US benchmark interest rate is expected to be 'frozen' with over 95% probability. However, the market's focus is not on this. Depending on how Fed Chair Jerome Powell suggests the future monetary policy direction in the press conference after the rate announcement, and what statements he makes about his recent controversial position, the bond market is expected to react significantly.
At 9:30 PM on the 31st, the US June Personal Consumption Expenditures (PCE) inflation will be announced. This PCE announcement can serve as a barometer to confirm whether the Trump administration's tariff policy actually raises US prices, making it highly important.
Here is another event. The Trump administration's cryptocurrency policy report, which was originally scheduled to be released on the 22nd last week but was postponed, is now set to be published on the 30th. Initially, the main contents were expected to include specific plans for creating and operating a Bitcoin strategic reserve fund and measures to activate stablecoins. However, the latter has largely lost its necessity due to the passage of the Genius Act. Whether or not a comprehensive plan emerges on how the United States will accumulate Bitcoin is expected to be a crucial factor influencing market investor sentiment. We wish our readers a successful investment this week as well.
