Quick Take

• The volume of Bitcoin held at a loss reached an all-time high of 10.8 million BTC.
• U.S. spot BTC ETFs saw a net outflow of US$1.8 billion last week, compared to a $228 million outflow the week prior. Spot ETH ETFs saw a net outflow of $273 million in the same period, compared to a $10 million outflow the week prior.
• The week was defined by a sharp rotation out of high-flying technology and AI stocks, leading to a stark divergence in index performance. This dynamic underscored a broader shift toward defensive sectors and smaller-cap equities amid quarter-end rebalancing, sticky inflation data, and shifting geopolitical headlines.
• • Nasdaq Composite declined -4.60%, its worst weekly drop since early June, closing near 25,298. S&P 500 dropped -1.95%, dragged down by mega-cap tech. Dow Jones Industrial Average gained +0.60%, eking out a third straight weekly win.
  • Key Market Drivers: 
  • • AI and Tech Pullback: A broad rotation out of semiconductor and AI-related stocks served as the primary anchor on the broader market. Sentiment took a significant hit following reports that OpenAI is considering a delay to its IPO due to escalating infrastructure costs.
    • Resilient Macro Data and Fed Rhetoric: Economic indicators painted a picture of a resilient U.S. economy. The PCE Price Index (the Fed's preferred inflation gauge) rose 4.1% year-over-year, in line with estimates, while Q1 GDP was revised upward to 2.1%. However, sticky services inflation kept the Fed hawkish, with officials warning that underlying price pressures remain too high.
    • Geopolitics and Energy: Crude oil (WTI) retreated to around $70 after the U.S. and Iran reached a ceasefire agreement to reopen the Strait of Hormuz, easing immediate supply-chain concerns and pulling energy commodities lower.
  • Sector and Style Dynamics: Defensive and yield-sensitive sectors were the clear winners, with Healthcare surging 7.88% and Real Estate climbing 4.16%. In stark contrast, Technology tumbled 5.32% and Consumer Cyclicals fell 2.59%. Growth stocks took a heavy hit (down 2.57%) as the AI rally cooled and infrastructure costs were scrutinized, allowing Value-oriented equities to demonstrate relative outperformance.

Research Dashboard

According to our research dashboard, the price and volatility indices dropped -7.05% and -40.64%, respectively, while the volume index surged +8.23% last week.

Most tokens showed bearish price action. BTC and ETH prices decreased by -5.72% and -7.79%, respectively. Avalanche (AVAX) led the price gains, while Polkadot (DOT) and Zcash (ZEC) led the drop in price and volatility. AVAX showed a significant increase in new addresses in Q2 2026, and FIFA is testing a new ticketing model for the 2026 World Cup by leveraging Avalanche. Zcash’s performance could be affected by whales and KOLs.

Chart of the Week

As BTC fell below $59,000, the amount of Bitcoin held at a loss reached an all-time high of 10.8 million BTC, representing 53.7% of BTC supply. The supply in loss increased significantly by 73.6% year-to-date. Despite market downturns, long-term holders (investors holding for 155+ days) have increased their control to a record 16 million BTC, representing approximately 80% of the circulating supply.

Weekly Performance

Most top-cap tokens saw bearish price action last week. AVAX (+5.6%) and OP (+0.5%) bucked the trend to post gains, while DOT (-14.0%) and NEAR (-12.4%) led the drop.

Categories saw mixed performance in market capitalization (MC), with Lending and Liquid Staking leading the increase, while RWA led the drop.

News Highlights

Company News

• Loaded Lions, Crypto.com's flagship NFT collection and Web3 entertainment brand, opened pre-registration for Mane City Mobile on iOS and Android. Previously a desktop-only title, the strategy game will now bring territory building, real-time PvP, and marketplace trading to mobile users in over 100 countries.

Regulation

• The U.S. Senate approved a housing affordability bill containing a provision that imposes a four-year ban on the Fed issuing a central bank digital currency (CBDC). This reflects ongoing legislative resistance against government-issued digital currencies over surveillance and financial control concerns. However, President Donald Trump canceled the signing ceremony for this bill, demanding instead that Congress first pass the "SAVE America Act." This unrelated legislation would require proof of citizenship and identification for voters.
• The European Parliament cleared the final legislative hurdle for a digital euro by approving its legal framework. This enables the European Central Bank to pursue a potential 2029 launch, aiming to establish European monetary autonomy and reduce reliance on U.S.-dominated payment networks.
• The Bank of England introduced comprehensive rules to govern stablecoins within the region. This newly established clarity sets a solid regulatory foundation, paving the way for a targeted stablecoin launch and broader market integration by 2027. 
• South Korea’s Financial Services Commission (FSC) integrated token securities infrastructure into a broader capital market modernization plan, which includes faster settlement cycles, extended trading hours, and increased use of AI. This move aims to align blockchain-based investment products with traditional market systems, enhancing efficiency and accessibility while maintaining core priorities of trust, shareholder protection, innovation, and market access.

Adoption

• Digital asset issuer Circle formed a strategic partnership with financial institution Nomura to launch an instant foreign exchange (FX) settlement business. The collaboration intends to leverage stablecoin technology to drastically accelerate cross-border currency trades.

Investment Vehicles

• Cboe Global Markets introduced "Cboe Predicts," a suite of binary option contracts based on the Mini-S&P 500 Index (XSP). This move introduces regulated, "yes-or-no" event contracts to retail brokers, marking a mainstream financial exchange's expansion into the prediction market sector. 
• Invesco filed with the U.S. Securities and Exchange Commission (SEC) to register the Invesco Stablecoin Reserves Onchain Fund. This new tokenized fund is designed to serve the growing stablecoin market by investing in cash and short-term U.S. Treasury securities, aligning with the reserve requirements outlined in the proposed GENIUS Act.

Catalyst Calendar

Recent Research Reports

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