Matrixport Market Observation: Macroeconomic Stabilization and Continued Inflow of Traditional Capital Boost BTC Price Rise

Last week (May 12 - May 19), BTC was driven by multiple factors to briefly break through $107,000, setting a new high for May. Following a surge that broke through $100,000 the previous week, BTC's price remained in a high-level consolidation from May 12 to May 17, until it quickly rose after 20:00 on May 18, breaking through the strong resistance level of $104,000 ~ $105,000 from the previous consolidation phase, reaching a short-term high of $107,108.62 in the early hours of May 19, marking the highest weekly closing price ever. Subsequently, BTC's price retraced to around $105,000 and found support, with the current price at $105,460, and a maximum volatility of 6.34% during the week.

ETH's price moved in the opposite direction to BTC, experiencing a pullback after hitting a high. Influenced by the rebound in the U.S. April CPI data, ETH quickly rose after 20:00 on May 13, reaching a short-term high of $2,738.5, followed by a technical correction over the next few days, oscillating widely in the $2,400 ~ $2,600 range. On May 19, ETH dipped below $2,400 twice but quickly rebounded, with the current price stabilizing around $2,550, and a maximum volatility of 15.16% during the week (data source: Binance spot, May 20, 14:50).

As of the close on May 19, the three major stock indices opened lower but rose during the session. U.S. Treasury yields surged and then retreated, showing a V-shaped reversal. The dollar weakened, dropping more than 0.7%, approaching the psychological level of 100.

Market Interpretation

ETF Fund Inflows and Institutional Trading Activities Drive BTC to Break $107,000

Recently, Bitcoin spot ETFs listed in the U.S. have continued to see fund inflows, with a net inflow of over $5.6 billion since April and a cumulative net inflow of over $41 billion since the beginning of 2024. The inflow of funds has directly driven BTC's price higher, breaking through $107,000 with significant volume from the evening of May 18 to the early hours of May 19, setting a new high for May.

Data shows that there have been multiple large BTC transfers on-chain recently, while leveraged funds' short positions have decreased, indicating that the inflow of funds is more driven by institutional bullish positioning rather than arbitrage trading. The net outflow of BTC from exchanges has increased, easing market selling pressure. The sentiment index has risen from neutral to greed, suggesting that the short-term market may maintain a strong consolidation.

Gold Prices Retrace, Diversion of Safe-Haven Funds from BTC

Since April 2025, gold and BTC have shown a divergence in their trends. Gold has cumulatively risen nearly 30% from the beginning of the year to early May, but since late April, influenced by a stronger dollar, tighter Federal Reserve policies, and U.S.-China trade developments, gold prices have retreated from a mid-May high of $3,394 per ounce to $3,127 per ounce, a cumulative decline of about 8%.

On the funding side, inflows into gold ETFs have slowed, with even outflows occurring in mid-May. In contrast, BTC spot ETFs have shown significant daily capital inflows, indicating that institutional safe-haven allocations are beginning to tilt towards crypto assets. The dollar index has oscillated at high levels, with interest rates remaining tight, putting pressure on gold, while BTC, supported by policy and fund inflows, has gained more recognition for its "digital safe-haven" properties.

U.S. April Inflation Data Shows Divergence, Probability of Fed Rate Cut in June Rises to 91.4%

The U.S. April CPI rose by 0.3% month-on-month, with core CPI also rising by 0.3%, in line with expectations, leading to a moderate market reaction to the short-term data.

At the same time, the PPI unexpectedly fell by 0.5% month-on-month, marking the largest decline in five years, reflecting pressure on corporate profits, with some tariff costs absorbed by companies. Overall, the transmission of inflation remains insufficient, pushing market expectations for the Fed to maintain interest rates in June up to 91.4%.

Market Highlights

U.S. Senate Advances Stablecoin Regulation Bill, Industry Regulation Enters New Phase

On May 20, 2025, the U.S. Senate passed a procedural motion for the "GENIUS Act" with 66 votes in favor and 32 against, marking a key step in U.S. stablecoin regulation. The bill aims to establish a federal regulatory framework, clarifying issuance entities, reserve requirements, and compliance standards, filling a regulatory gap.

Total Value of RWA Surpasses $22.6 Billion, U.S. Leads Global Tokenization Innovation

As of May 20, the total value of RWA reached $22.6 billion, growing 5.85% over 30 days, with over 101,854 holders. Wall Street institutions like BlackRock and Goldman Sachs are actively promoting asset tokenization, and U.S. policies are also reinforcing support, driving the continuous expansion of the tokenization ecosystem.

Hong Kong Securities and Futures Commission Releases Pledge Service Regulatory Framework, Strengthening Compliance Signals

The Hong Kong Securities and Futures Commission has issued a notice clarifying the regulatory requirements for virtual asset trading platforms providing pledge services. This measure provides a clear compliance path for the market, expected to enhance trust and promote the healthy development of Hong Kong's virtual asset ecosystem.

Labubu Craze Drives MEME Coin LABUBU Market Cap Surge

The Labubu craze has spilled over into the crypto market, with the market cap of MEME coin LABUBU skyrocketing from several hundred thousand dollars to $18 million in a week, with a 24-hour trading volume reaching $9.5 million. Previously, Labubu had high popularity in Thailand, and this round of enthusiasm, combined with the resonance of physical collectibles and market sentiment, has significantly increased capital attention.

Disclaimer: The above content does not constitute investment advice, sales offers, or purchase offers to residents of the Hong Kong Special Administrative Region, the United States, Singapore, or other countries or regions where such offers or invitations may be prohibited by law. Trading in digital assets may involve significant risks and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions made based on the information provided in this content.