Markets Dip, Momentum Builds

GM Anon!

Markets pulled back this week as tariffs returned, yields spiked, and traders paused to digest a whirlwind of political and macro headlines. Bitcoin slipped after briefly reclaiming key levels, while SOL and SUI led the bleed on the back of memecoin fatigue. But beneath the red, momentum is shifting — from JD Vance’s pro-BTC keynote to rising institutional exposure and smart money rotations, the next leg is already taking shape. Let’s break it down.

TLDR

• Crypto markets dipped as U.S. tariff reinstatements and a 30Y yield surge above 5% reignited macro risk-off sentiment.

• JD Vance delivered a surprise pro-Bitcoin speech at Bitcoin Vegas, endorsing a Strategic Bitcoin Reserve and crypto retirement regulations.

• Institutional momentum accelerated: GameStop, Trump Media, Metaplanet, and others are raising billions to acquire BTC.

• Regulatory tone is shifting: SEC may drop its Binance case; Bybit secured a MiCA license; Revolut to relaunch crypto in the U.S.

• BTC options open interest hit an all-time high of $46.2B, reflecting heightened derivatives activity and institutional exposure.

• ETH briefly reclaimed its 200DMA at $2,686 before cleanly rejecting — that level now acts as resistance.

• SOL and SUI led weekly losses at -11.1% and -11.7% respectively, as memecoin profit-taking hit the Solana ecosystem.

• Arbitrum saw the strongest L1/L2 inflows over the past month, while Solana, Berachain, and OP posted outflows.

• Smart money rotated out of Fartcoin and LABUBU into IBRL on Solana, and into MOODENG, ANDY, and CULT on Ethereum.

Market Update

Crypto markets pulled back this week as global macro stressors collided with historic crypto policy momentum. The catalyst on the macro side was the U.S. government's decision to reinstate tariffs—an unexpected reversal that rattled risk assets across the board. Compounding the pressure, the U.S. 30-year Treasury yield jumped back above the 5% mark, deepening concerns over long-duration rates and their impact on liquidity conditions.

While Nvidia posted a strong earnings beat and FOMC minutes remained unchanged in their cautious “wait and see” stance, broader market sentiment continued to sour. Some had expected political commentary to shift tone, but JD Vance’s speech—widely hyped ahead of the Bitcoin Vegas conference—initially landed flat, offering little substance and largely targeting past administrations. 

Though, in an unexpected pivot, JD Vance used the conference keynote to issue the strongest pro-crypto message yet from the executive branch. On stage in Las Vegas, Vance declared that with Trump back in office, the U.S. finally has a true ally in the White House. He signaled the administration’s intent to create a Strategic Bitcoin Reserve, pursue new regulations enabling crypto holdings in retirement accounts, and framed BTC as a strategic asset in the battle for global economic dominance—particularly against China.

The market dipped during the speech, but the political and institutional shift was unmistakable. Major global players are rapidly aligning around BTC. Pakistan confirmed it will establish a national Bitcoin reserve, while major U.S. entities such as Trump Media, Strive, and Metaplanet are raising billions to acquire BTC on balance sheets. GameStop has reportedly purchased $512 million worth, and PSG Football Club revealed a treasury allocation. In parallel, Cantor Fitzgerald is designing a BTC fund backed by a gold safety net. Meanwhile, El Salvador defied IMF instructions and added more BTC to its reserves.

On the regulatory front, momentum is also shifting. The SEC appears ready to drop its case against Binance. Bybit has secured a MiCA license in Austria, and Revolut is preparing to relaunch crypto services in the U.S. Elsewhere, BlackRock is rumored to be acquiring a 10% stake in Circle’s upcoming IPO, while Telegram is eyeing a $1.5 billion bond raise and a potential $300 million integration with xAI’s Grok.

Despite the pullback, sentiment on the ground in Vegas remains unmistakably bullish. With Trump signaling full-spectrum support, capital continuing to flow into the ecosystem, and BTC increasingly framed as a geopolitical asset, the long-term trend appears firmly intact. The coming weeks will be crucial in determining whether the market digests these macro and political developments constructively—or if risk-off sentiment triggers another round of rotation and rebalancing.

Market Data Points 

Hyperliquid just crossed a major milestone with over $2.92 billion in total USDC deposits bridged to the platform as of May 25, 2025. After a few months of plateaued inflows, capital is surging back in, marking the platform’s strongest uptrend in deposits since late 2024. 

This sharp move reflects rising trader confidence and liquidity migration back into Hyperliquid's ecosystem—likely driven by recent price action, protocol upgrades, and continuing interest in decentralised perp infrastructure.

Over the past month, capital rotation has dramatically reshaped the L1/L2 landscape. Arbitrum leads all networks in net inflows, pulling in significantly more capital than any other chain. Injective, Unichain, and Ethereum also saw strong monthly inflows, reinforcing growing confidence in ecosystems tied to on-chain trading, infra, and liquidity depth. 

Meanwhile, Berachain, OP Mainnet, and Solana posted some of the largest outflows, suggesting traders may be rotating away from previously hot narratives. Despite broader market churn, smaller players like Hyperliquid, WorldChain, and Sei ended the month in the green.

Sky's rebrand from MakerDAO has failed to gain traction, with TVL steadily dropping despite new incentives and token migration efforts. The protocol is now seeing its lowest engagement in years, as community adoption of the SKY token remains limited and the broader market shows signs of cooling interest.

ETH briefly crossed above its 200-day moving average this week but failed to hold the breakout. The level—currently sitting near $2,686—is acting as stiff resistance, capping the recent rally. Price is now consolidating just below it, with bulls needing a clean reclaim and close above the 200DMA to confirm trend reversal.

BTC options open interest has surged to a new all-time high of $46.2B, reflecting a sharp $25.8B increase over recent weeks. This spike signals heightened derivatives activity and growing institutional exposure, as traders position for volatility following BTC’s recent rally to ATHs. 

Majors & Memes

The crypto majors faced notable pressure over the past week. BTC dipped -3.6%, pulling back from recent highs and reinforcing short-term resistance just above the $104K mark. Despite the correction, BTC remains the dominant macro driver. ETH fared slightly better with a -0.7% loss, although price action remains choppy as the asset struggles to reclaim momentum.

SOL posted one of the sharper drawdowns among top names, falling -11.1% on the week—a reversal that mirrored a broader decline in trading activity and profit-taking across the memecoin-heavy Solana ecosystem. Meanwhile, SUI also suffered a sharp -11.7% weekly loss, extending its underperformance after a period of strength earlier this quarter.

On the upside, mid- and low-cap coins like ZBCN rallied +127.7%. LPT followed closely with a +118.2% rise. Other strong performers included VENOM +18.3%, and SAROS +16.8%. SPX made back-to-back appearances across trending charts with a +15.5% gain, suggesting early traction and strong positioning with this established memecoin.

VIRTUAL held its ground with a minor +0.1% move—recently outperforming most majors but pausing after weeks of accumulation and narrative tailwinds in the AI agent meta.

In summary, majors are cooling while capital rotates into select high-beta altcoins and sector-specific narratives. Traders appear undecided, rotating into niche corners of the market, particularly around real-world infra, AI, and token infrastructure protocols. The next market moves hinge on whether BTC stabilizes or pushes higher.

Mindshare

Over the past week, mindshare within the Solana ecosystem has seen some clear shifts as traders rotated into fresh narratives while others lost traction. The most dominant trend: LABUBU firmly held the top spot in attention share across the entire period, reinforcing its position as a core focus for ecosystem participants.

But below the surface, the story gets more dynamic.

Trenches made a notable push mid-week, peaking around May 27 and briefly challenging LABUBU’s lead before tapering off into the weekend. Meanwhile, tokens like AIXBC, USELESS, and KLED gained significant ground in the second half of the week, signaling emerging and continued interest. 

IBRL and STARTUP maintained relatively stable mindshare across most of the week, holding mid-tier positions—enough to signal consistent attention but not explosive growth. In contrast, DUPE and YAPPER, despite being active in previous smart money charts, saw mindshare stagnate or slightly decline, suggesting interest is rotating elsewhere.

By May 30, attention fractured heavily across a wide number of tokens including Amiko, KORI, PNP, and BANNED, hinting at a wave of speculative rotation and short-term experimentation. This kind of spread often precedes a new frontrunner emerging from the crowd.

Key takeaway: While LABUBU retains the crown, the ecosystem is in the midst of a reshuffle. Rising attention for names like AIXBC and USELESS combined with broader fragmentation points to a new wave of speculation—and potential breakout narratives just around the corner. Stay nimble.

Smart Money Accumulation

Smart money activity across the Solana ecosystem this week leaned more rotational, with capital moving out of prior winners and into select fresh narratives. While inflows were more muted overall, certain tokens stood out with meaningful positioning shifts.

Launchcoin continues to hold the top spot by smart money wallet count (13 wallets), maintaining a solid $1M balance. However, holdings ticked down -1.61%, suggesting mild trimming rather than an outright exit. It still sits atop the leaderboard in terms of conviction, but newer plays are starting to catch attention.

The clear breakout was IBRL, which saw a massive +61.25% increase in holdings—jumping to $714K across 11 wallets. That’s one of the sharpest weekly wallet allocation spikes this quarter, signaling growing confidence.

Meanwhile, Fartcoin (-24.67%) and LABUBU (-32.63%) saw heavy reductions despite high balances, reflecting sustained profit-taking after strong prior runs. Similarly, KLED and DUPE also saw declines of -28.53% and -5.64%, respectively.

Newer or stable plays like ALON (flat at $152K) and STARTUP (+10.8%) showed steady or growing positioning. And TPT entered the chart this week, tracked in 5 wallets with ~$84K in capital—early, but worth watching.

All in, the data points to a mild rotation phase: top-heavy positions like Fartcoin and LABUBU are being trimmed, while smart money consolidates into emerging bets like IBRL and maintains conviction in anchors like Launchcoin.

Smart money flows on Ethereum this week reveal a mix of steady conviction and opportunistic rotation into mid-tier tokens. While no runaway leader emerged, a handful of names are starting to build quiet momentum.

CULT remains a dominant holding across 11 wallets with $633K in value, though allocation dipped slightly (-0.09%) — suggesting position maintenance rather than exit. It continues to act as a base layer play for many smart wallets.

MOODENG led on percentage growth, up +37.68%, with five wallets now holding nearly $85K. Similarly, ANDY saw a +32.69% jump, bringing its total wallet value to $228K — a strong weekly rise that suggests narrative traction.

COCORO (+27.04%) and SHRUB (+11.04%) also posted solid gains in wallet holdings, while SBET entered the list as a new entrant, now tracked in six wallets with $156K in capital.

Elsewhere, JOE and MOONKIN saw light but consistent increases (+0.05% and +2.65%), both supported by healthy balances and stable wallet count. PEPE and KTA, despite sizable holdings ($1.5M for KTA), saw mild drawdowns, suggesting rotation rather than rejection.

In summary, this week’s ETH smart money flows highlight early-stage re-accumulation, with steady conviction across a few names and a quiet rise in high-beta meme and niche ecosystem plays. No mass rotation yet—but signs are stirring.

That wraps up this post—we hope you found the insights valuable. See you next week, anon! 🚀