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Weekly Review
From May 19 to May 26 this week, Ice Sugar Orange peaked near $111,980 and bottomed close to $102,000, with an oscillation range of about 9.78%.
Observing the chip distribution chart, around 99,000 there is a large amount of chip transactions, which will provide some support or pressure.
Analysis:
60000-68000 approximately 1.22 million pieces;
76000-89000 approximately 1.25 million pieces;
90000-100000 approximately 1.43 million pieces;
In the short term, the probability of not breaking below 95,000-100,000 is 80%;
In terms of important news
In terms of economic news
Core event: The repetition and uncertainty of Trump's tariff policies
Content: Trump fluctuates between 'imposing 50%' tariffs on EU and '90-day negotiation window extended to July 9.' The fourth round of tariff talks between Japan and the U.S. is scheduled for the 30th.
Expectations and statements of the Fed's monetary policy
There are differences in expectations for interest rate cuts:
Goolsbee: Interest rate cuts may still be possible in the next 10-16 months (dovish).
Bostic: Need to wait 3-6 months to observe uncertainties (neutral).
Williams: Cannot fully clarify in June or July (cautious).
Morgan Stanley: The Fed will not cut interest rates this year, starting from March 2026 (hawkish, significantly different from mainstream market expectations).
Key data: Friday's PCE data is an important basis for the Fed's monetary strategy.
Other macro indicators and asset prices
U.S. stock index futures rose (Nasdaq futures 1.5%, S&P 500 index 1.2%).
The U.S. dollar index fell 0.1%.
Citi raises gold price target to $3,500/ounce (due to tariff escalation expectations).
U.S. Treasury Secretary states that the sovereign wealth fund plan will be paused.
In terms of news about the crypto ecosystem
Bitcoin (BTC) market performance and driving factors
BTC price rebounds to $110,000 (after the easing of Trump's tariff policies).
Coindesk analysts: BTC's all-time high is mainly driven by institutions, and the retail Meme craze has faded, shifting market sentiment towards more sustainable behavior, potentially paving the way for the long term.
Analyst Eugene Ng Ah Sio: BTC maintains a clear upward trend, and if sustained, the altcoin market has opportunities.
Interpretation:
Institution-led 'ongoing narrative': The success of the ETF is one of the core driving forces of this round of BTC bull market, which is a typical 'ongoing narrative.'
ETF fund flows (core 'ongoing narrative')
Last week, the U.S. BTC spot ETF inflow was $2.75 billion, and ETH spot ETF inflow was about $250 million (the highest since early February).
The cumulative net inflow of the U.S. BTC spot ETF reached $44.499 billion, setting a new historical high.
BlackRock's IBIT has had no net outflow for 30 consecutive days, with net assets exceeding $71 billion.
Corporations and institutions increase their holdings of BTC (strengthening institutional narratives)
Bitwise data: By 2025, corporate BTC purchases in the U.S. have already exceeded three times the new supply of BTC.
Semler Scientific increased its holdings by 455 BTC.
Strategy increased its holdings by 4020 BTC last week.
Regulatory dynamics and industry conferences (key variables affecting 'expected narratives')
SEC's Hester Peirce supports providing clearer guidelines for the jurisdiction of securities law for activities like PoS/DPoS, seen as positive news for institutional participation in staking in the U.S.
Bitcoin 2025 conference (May 27-29), the White House cryptocurrency and AI director, U.S. senators, and expected Vice President Pence will participate.
Analysis:
The 'expected narrative' of regulatory clarification: Peirce's statement is very important; it points to the regulatory environment potentially developing in a clearer and friendlier direction, which is crucial for the long-term healthy development of the industry, especially in emerging fields like staking.
Long-term insights: Used to observe our long-term situation; bull market/bear market/structural changes/neutral state
Medium-term exploration: Used to analyze what stage we are currently in, how long this stage will last, and what situations will be faced.
Short-term observation: Used to analyze short-term market conditions; as well as the possibility of certain events occurring under certain premises.
Long-term Insights
Illiquid long-term whales
Total selling pressure on-chain
BTC's U.S. ETF
Holding structure of long-term participants of different durations
Net positions of large inflows and outflows on exchanges
Cost lines of short-term and long-term holders
(Below figure of illiquid long-term whales)
Since the end of 2023, there has been a continuous upward trend, indicating that these entities are continuously accumulating.
Overall trends indicate that long-term holders and whales have steadfast beliefs, continuously withdrawing BTC from the liquid market, forming strong supply-side support.
The long-term bullish structure remains unchanged, but the newly added buying momentum may marginally weaken in the short term.
(Below figure of total selling pressure on-chain)
Recently, the overall 'total selling pressure' in the market is slightly on the rise.
There is a small inflow, but the trading activity is a normal rotation rather than a panic sell-off.
From the perspective of 'potential selling pressure', there have been no concerning signs of large-scale chips concentrating towards exchanges recently, and market selling willingness is low.
(Below figure of BTC's US ETF)
Recently, the amount of fund inflows into ETFs has indeed seen a significant decline compared to previous peaks, even approaching zero or showing small net outflows on certain trading days.
Currently:
The 'ongoing narrative' faces challenges: The slowdown in ETF fund inflows is a direct test of one of the core driving forces of this bull market.
Current ETF flows are a key window for observing institutional attitudes and sources of new funds; their continued weakness will put pressure on market confidence.
The buyer power driven by ETFs is marginally weakening, which is a significant change facing the current market.
The market needs to find new demand growth points or wait for ETF demand to recover under new conditions.
(Below figure of holding structure of long-term participants of different durations)
The proportion of long-term holders (the area from green to purple overlapping) has recently slightly risen to 0.449.
Analysis:
The increase and maintenance of the proportion of long-term holders (often considered 'smart money' or steadfast investors) is a sign of a healthy market structure, reducing short-term speculative selling pressure.
Synergy with Figure 1: This aligns with the increasing trend of illiquid supply in Figure 1, depicting the transfer of chips from short-term traders to long-term holders, and the shift from abundant liquidity to tight supply.
The microstructure of the market remains solid, with the 'ballast' effect formed by long-term holders being significant.
(Below figure of net inflows and outflows of large positions on exchanges)
Represents large transfers (yellow $1-10 million, red over $10 million) of net outflows.
Recently, although it hasn't been as sustained and intense as in some previous phases, the overall net outflow remains the dominant trend, and large-scale net inflow has not appeared.
Although ETF flows have slowed, large amounts of funds continue to net out of exchanges, indicating that large holders or institutions are still accumulating BTC and conducting self-custody, or withdrawing after trading through the OTC market.
The potential selling pressure from exchanges continues to decrease, and the accumulation behavior of large holders is ongoing, although its intensity may fluctuate with the market environment.
(Below figure of cost lines of short-term and long-term holders)
The short-term investor cost line (orange-yellow) is currently at $95,411. The current price (approximately $109,000) is still significantly above this cost line.
As long as the price remains above the average cost of short-term holders, the risk of large-scale panic selling in the short term is low, as most short-term participants are in a profitable state.
Key support level: $95,411 is an important psychological and technical support area. If the price retraces to this level and gains effective support, it will strengthen market confidence; if it breaks below, it may trigger stop-loss orders, increasing short-term downward pressure.
The battleground for new and old capital: This price level is also a key area for new incoming capital and short-term funds seeking to take profits to contend.
Short-term market structure remains healthy, but attention should be closely paid to the effectiveness of the support at $95,411.
Overall analysis:
1. Cornerstone: Supply side continues to tighten, long-term holders' beliefs are steadfast.
Although short-term buying momentum is marginally slowing, illiquid supply continues to increase, the proportion of long-term holders remains stable and slightly rising at a high level, and large amounts of funds continue to net out of exchanges, with large transfers to exchanges (potential selling pressure) remaining inactive.
Together, they form a strong supply-side support for the market, which is a core feature that distinguishes it from previous cycles.
2. Current challenges: Weakened ETF driving force, the market faces demand tests (Figure 3).
The significant decline in ETF fund inflows is the most direct challenge facing the current market.
This indicates that the previously main source of incremental funds has become weak, and the market needs new demand stories or a recovery of existing demand to maintain upward momentum.
3. Short-term market sentiment and key water level (Figure 6).
The current price is above the short-term holder cost line ($95,411), providing the market with a 'safety cushion'. This price level is a key watershed for judging the strength of the short-term market.
4. The overlay effect of macro uncertainty and narrative vacuum periods.
Against the backdrop of weakened ETF inflows, the macro-level uncertainties (Trump tariffs, Fed policy fog) may amplify the negative impact on market sentiment.
At the same time, as discussed below (news analysis and summary), new 'expected narratives' capable of attracting large-scale funding (such as stablecoin channels, substantial regulatory breakthroughs) have yet to form effective relay, and the market may be in a brief 'narrative vacuum period' or 'narrative fatigue period.'
5. Pressure under 'Attention Competition'.
In the context of weakened self-driving forces and unclear macro environment, the crypto market (especially assets outside of BTC) may appear more passive in the 'attention competition' with stronger narratives such as AI.
Future outlook:
Medium to short-term:
Main tone: Likely high-level oscillation, critical period for direction selection.
The market may undergo a period of oscillation and consolidation in the current price range (e.g., with $95,411 as the lower bound and a previous high as the upper bound). The choice of direction will depend on:
Will ETF flows recover? This is the most important observation indicator.
Will there be positive catalysts in the macro news? (Such as PCE data better than expected, the Fed releasing dovish signals, easing trade frictions).
Can new industry narratives emerge and attract funds?
Downside risks: If ETF continuous net outflows occur and macro-level negative factors emerge, if the price breaks below the short-term holder cost line of $95,411, it may trigger deeper adjustments, and the market will re-test lower long-term support levels.
Upside potential: If ETF resumes its upward trend or other significant positives emerge, coupled with the already tight supply side, prices will have the momentum to challenge and break new highs, but the process may be more tortuous than before.
Expectations for a 'summer surge' face tests: From market news, the market is waiting for this summer to break the market calm and bring about another surge; under the current backdrop of weakened ETF flows, achieving this becomes more difficult and requires strong catalysts from the macro level or within the industry.
Medium to long-term:
The foundation of a structural bull market still exists, but the path relies more on the realization of fundamentals.
The supply structure dominated by long-term holders is the core logic for long-term optimism. However, the magnitude and sustainability of the future bull market will rely more on:
Can the crypto industry truly generate sustainable economic value and large-scale applications? (Whether 'stablecoin/exchange channels' and other expected narratives can be realized is key (high difficulty)).
Can the regulatory environment develop in a clearer and friendlier direction? This will determine whether institutional funds can flow in on a larger and more sustained scale.
Can BTC consolidate and expand its value positioning in competition with traditional assets and emerging technologies? Not just 'digital gold', but are there other widely recognized narratives?
Differentiation will intensify:
In a more challenging market environment, only projects with true core technology, strong ecosystems, and clear value propositions can stand out.
Medium-term exploration
Liquidity supply
Analysis of structures at various price levels
Futures clearing structure
WTR risk coefficient 1
Comprehensive score of USDC purchasing power
Comprehensive score for whales
(Below figure of liquidity supply)
The liquidity supply remains significantly growing, suggesting that the factors driving changes in the market at this stage have not been exposed to liquidity risks.
Abundant liquidity can allow the market to maintain its amplitude within the current pricing structure.
(Below figure of analysis of structures at various price levels)
The current stock peak price is around 108,000, and the price of the short-term cost line is around 95,000.
Currently, pricing may hover around these two price levels.
(Below figure of futures clearing structure)
The current derivative clearing structure has switched from bearish liquidation to bullish liquidation structure.
Currently, the risks faced by bulls may be higher than those faced by bears.
After the previous bearish trend shifted to a bullish trend, the market is briefly undergoing high-level horizontal consolidation.
To complete the observation comprehensively, consider the risk factors of the spot market.
(Below figure WTR risk coefficient 1)
WTR risk coefficient 1 shows that currently, BTC and ETH have not exposed significant spot risks,
The preconditions for significant corrections have not yet formed.
(Below figure of comprehensive scores of USDC purchasing power)
USDC purchasing power has slight score volatility, but remains at a high score.
There may still be liquidity support from USDC purchasing power in the market.
(Below figure of comprehensive scores of whales)
Whale scores remain high and have not declined.
The market still seems to lean towards a wandering tone.
Short-term observation
Derivative risk coefficient
Options intention transaction ratio
Derivative trading volume
Implied volatility of options
Profit and loss transfer amount
New addresses and active addresses
Net positions at the Ice Sugar Orange exchange
Net positions at the Auntie Tai exchange
High-weighted selling pressure
Global purchasing power status
Net positions of stablecoin exchanges
Derivative rating: Risk coefficient is in the red zone, derivative risks are high.
(Below figure of derivative risk coefficient)
The risk coefficient remains in the red zone, and currently, there is little liquidation for both bulls and bears. Consistent with last week's expectations, this week's derivatives market will experience significant volatility, leading to liquidations for derivative participants.
(Below figure of options intention transaction ratio)
The proportion of put options is at a medium-high level, and trading volume is at a median level.
(Below figure of derivative trading volume)
Derivative trading volume is at a median level.
(Below figure of implied volatility of options)
Implied volatility of options has only had low amplitude fluctuations in the short term.
Sentiment state rating: Neutral
(Below figure of profit and loss transfer amount)
Last week mentioned the positive sentiment in the market (blue line) and that prices were in a state of divergence, subsequently, market sentiment rose to a short-term high, breaking this divergence.
(Below figure of new addresses and active addresses)
New active addresses are at a low level.
Spot and selling pressure structure rating: BTC and ETH are in a state of continuous large outflows.
(Below figure of net positions at the Ice Sugar Orange exchange)
Currently, BTC is continuing to see large outflows.
(Below figure E's net position on the exchange)
Currently, ETH is continuing to see large outflows overall, with only a small inflow.
(Below figure of high-weighted selling pressure)
ETH has a significant selling pressure from high-weighted positions, but it has eased currently.
Purchasing power rating: Global purchasing power and stablecoin purchasing power remain flat compared to last week.
(Below figure of global purchasing power status)
Global purchasing power remains flat compared to last week.
(Below figure of USDT's net position on the exchange)
Stablecoin purchasing power remains flat compared to last week.
Weekly summary:
News analysis and summary:
Current market 'splits' and 'dependencies':
Macro level: The market oscillates under the high uncertainty of Trump's trade policies and the ambiguous expectations of the Fed's monetary policy, with sharp fluctuations in risk sentiment. As part of the risk asset, the short-term trend of the crypto market is highly correlated with these macro factors.
Crypto internal: BTC relies on institutional fund inflows from ETFs and the 'digital gold' narrative, demonstrating a certain resilience and 'maturity' (QCP viewpoint), becoming the 'stabilizing force' of the market. However, this strength largely stems from the short-term realization of the 'ongoing narrative'.
The sustainability of core driving forces needs to be questioned:
After the 'honeymoon period' of the BTC ETF: After the initial institutional allocation is completed, whether subsequent fund inflows can continue will depend on whether BTC can continuously prove its value in global asset allocation (compared to gold, stocks, etc.) and whether the macro liquidity environment aligns.
Pressure on the realization of 'expected narratives': Whether it is the Fed's interest rate cuts, a clearer regulatory environment, or the large-scale implementation of crypto applications (such as 'stablecoin/exchange channels'), these 'expected narratives' driving future growth face a long and uncertain realization path. The market's patience for these narratives is limited.
Differentiation under Narrative Rotation and Attention Competition:
Internal Rotation: The rapid decline of the Meme craze suggests an acceleration of internal hot rotation in the market. If BTC can maintain its strength, some funds may flow into ETH (benefiting from ETF expectations and potential regulatory advantages) and other altcoins with real progress. However, a general rise is unlikely, and the 'authenticity' of fundamentals and narratives will be more important.
External Competition: The strong narrative of AI will continue to pose competition for 'attention' and 'funding' in the crypto industry. The crypto industry needs to find a path to coexist with AI or demonstrate unique advantages, or it may face the risk of marginalization in the 'positioning battle' of the tech wave.
Future: Finding structural opportunities amid uncertainties, but there are risks of 'expected' failures.
Medium to short-term:
The market will continue to negotiate between macro uncertainties (trade policies, Fed meetings) and internal driving forces of crypto (ETF fund flows, regulatory signals).
BTC is expected to maintain relative strength with institutional funding support, but overall market volatility remains high. PCE data and the Fed's statements before July will be key observation points. Whether summer can 'break the calm and bring a wave back to the market' depends on whether these uncertainties can develop positively.
Medium to long-term:
Optimistic scenario:
Improvement in macro liquidity (interest rate cuts realized), gradual clarification of the regulatory environment, continuous attraction of funds by ETFs, and some crypto applications with real value (potentially including the initial form of 'virtual world channels') begin to show results. The market may welcome a broader structural bull market, but differentiation will intensify.
Pessimistic scenario:
The macro environment continues to be unfavorable (stagflation, escalating geopolitical conflicts), regulatory tightening, slowing or even reversing ETF fund inflows, and 'expected narratives' failing to realize. The market may experience a prolonged period of adjustment and value reassessment. Other tech sectors like AI continue to be strong, further diverting resources from the crypto market.
Most likely scenario:
Great fluctuations, sometimes upwards, but the process is tortuous.
A few leading assets (like BTC, ETH) and truly valuable niche sectors can attract funding, while many projects lacking fundamental support will be eliminated.
The market will pay more attention to the actual utility and sustainability of crypto rather than pure speculative trading.
On-chain long-term insights:
The supply side of BTC remains very strong, which is an important source of market confidence.
However, the recent decrease in ETF fund inflows is a warning signal that cannot be ignored, indicating that one of the main demand engines of the market is 'cooling down.'
The current market is in a critical observation and direction selection period, where the macro environment, subsequent performance of ETFs, and whether new industry narratives can emerge will jointly determine the next phase of the trend.
Market positioning:
More attention needs to be paid to risks, and patience and caution should be maintained regarding the realization of 'expected narratives.'
Fervent sentiment may need to give way to more fundamental value considerations.
On-chain medium-term exploration:
Liquidity continues to expand, temporarily suppressing short-term risks, with the current market still having stable amplitudes.
The market oscillates near the stock ceiling of 108,000 and the short-term cost line of 95,000.
Derivative liquidation has shifted to a bullish dominance, with short-term bullish pressure rising.
BTC and ETH spot risk indicators have not shown abnormalities, and conditions for deep corrections are not yet sufficient.
USDC purchasing power rating remains high, and market liquidity support is solid.
Whale holding scores remain high, and the market maintains a consolidation structure.
Market positioning:
Wandering, vigilant
Abundant liquidity supports market volatility, but the derivative structure has shifted to a bullish liquidation structure, and caution is needed for potential turning points.
On-chain short-term observation:
Risk coefficient is in the red zone, derivative risks are high.
New active addresses are at a low level.
Market sentiment state rating: Neutral.
The net positions of exchanges for BTC and ETH are in a state of continuous large outflows.
Global purchasing power and stablecoin purchasing power remain flat compared to last week.
In the short term, the probability of not breaking below 95,000-100,000 is 80%;
Market positioning:
Currently, the selection of chips for profit-taking at this price level is relatively low, and purchasing power is sufficient to support it. This week's expectations are basically consistent with last week, and there is still the possibility of further short squeezes, while the probability of a direct large pullback is low.
Risk warning:
The above are all discussions and explorations of the market and do not constitute directional opinions for investment; please carefully consider and prevent risks of black swan events in the market.
This report is provided by the 'WTR' research institute.
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