Quick Take

• Strategy introduced a "Digital Credit Capital Framework" that authorizes BTC sales to fund dividends.
• U.S. spot BTC ETFs saw a net outflow of US$526 million last week, compared to a $1.8 billion outflow the week prior. Spot ETH ETFs saw a net outflow of $14 million in the same period, compared to a $273 million outflow the week prior.
• The U.S. stock market delivered a positive but highly polarized weekly performance. An aggressive sector rotation saw investors lock in profits from high-flying AI names to fund value and cyclical sectors. Soft labor data and easing geopolitical tensions lifted major benchmarks, helping push the Dow Jones Industrial Average past the historic 52,000 milestone to a fresh all-time high.
• • S&P 500 advanced 1.8% over the week. Dow Jones Industrial Average climbed 2.0% to finish at a record 52,900.07, marking its longest weekly winning streak since late 2024. Nasdaq Composite added 2.1%, shaking off sharp mid-week tech volatility.
  • Key Market Drivers: 
  • • Cooling Labor Market: June Nonfarm Payrolls added just 57,000 jobs, missing consensus. Although unemployment fell to 4.2% on a lower participation rate, the soft data relieved pressure on Fed Chair Kevin Warsh to hike rates.
    • Geopolitical De-escalation: U.S.-Iran ceasefire talks in Doha boosted sentiment. WTI crude fell to $68/barrel as energy disruption fears eased, tempering immediate inflation concerns.
    • Alphabet’s Dow Entry: Alphabet debuted as a Dow component on June 29. Its 4.8% first-day surge helped push the index to a new record.
    • Economic Expansion: June ISM Manufacturing PMI hit 53.3%, staying above the 50% threshold and signaling that the economy is moderating rather than facing a hard landing.
  • Sector and Style Dynamics: Leadership rotated toward cyclical and defensive sectors, led by Communication Services (+3.60%) and Financial Services (+3.39%). Meta climbed nearly 6% week-over-week, Comcast surged on media spin-off news, and Apple rose 8.8% on iPhone expansion reports. Conversely, AI momentum stalled under profit-taking; the PHLX Semiconductor Index (SOX) fell 4.4%, dragged down by double-digit drops in Micron, while Nvidia rose 1.2%.

Research Dashboard

According to our research dashboard, the price index grew +6.41%, while the volume and volatility indices dropped -4.26% and -15.76%, respectively, last week.

All tokens in the index showed bullish price action. BTC and ETH prices increased by +6.60% and +13.47%, respectively. Cardano (ADA) and Zcash (ZEC) led the price gains, while Uniswap (UNI) and Hedera (HBAR) led the volatility surge. ADA rebounded with a 32% price surge during the week following news that the network added approximately 15,000 new non-empty wallets since its June 23 bottom. Meanwhile, Zcash's late-July Ironwood upgrade, targeting a security flaw in the Orchard pool, may be delayed by infrastructure readiness issues. Canary's spot Hedera ETF saw $989,000 in net inflows on July 2, its highest daily total since mid-May.

Chart of the Week

BTC treasury company Strategy Inc. (MSTR) introduced a "Digital Credit Capital Framework," designed to manage liquidity while preserving its long-term Bitcoin exposure. The framework enables the company to monetize a portion of its Bitcoin holdings to fund dividends, build cash reserves, and execute share buybacks. Key components include:

• Bitcoin Monetization: Strategy authorized the sale of up to $1.25 billion in Bitcoin to raise capital designated for paying dividends, covering debt costs, funding stock buybacks, and bolstering cash reserves.
• Cash Reserve Target: The company has an established cash reserve of $2.55 billion, claiming it is sufficient to cover approximately 17 months of preferred stock dividends and interest payments. The policy mandates a minimum reserve of 12 months' coverage unless the board approves otherwise.
• Dividend Adjustment: The annual dividend rate on STRC preferred stock increased from 11.5% to 12%.
• Buyback Programs: The board authorized separate buyback programs for preferred securities and Class A MSTR common stock.

Weekly Performance

All top-cap tokens saw bullish price action last week. ADA (+31.8%) and BCH (+27.7%) led the gains.

All categories saw market capitalization (MC) increase, with Oracles (+10.2%) leading the growth, followed by RWA (+9.3%) and DEX (+9.1%).

News Highlights

Regulation

• The European Union is reviewing its Markets in Crypto-Assets (MiCA) regulation following the July 1, 2026, expiration of the transition period, which now requires all crypto-asset service providers (CASPs) to hold full licenses to operate within the bloc. While MiCA is fully in effect, the European Commission launched a consultation to assess whether the framework requires updates to better address the rapid evolution of stablecoins and RWA tokenization.
• The UK’s Financial Conduct Authority (FCA) lowered proposed capital buffer requirements for stablecoin issuers to 1% of the total value of issued stablecoins, undercutting the European Union's 2% MiCA mandate. This adjustment aims to create a more proportionate framework for larger issuers while maintaining regime robustness.
• Australia's cryptocurrency travel rule took effect on July 1, requiring domestic exchanges to collect, verify, and share precise identity records of senders and beneficiaries, alongside user declarations for self-hosted wallet transfers.

Adoption

• A consortium of over 140 payment, banking, and crypto firms launched the Open Standard and its dollar-pegged stablecoin, Open USD (OUSD). OUSD aims to eliminate minting and redemption fees while redistributing reserve interest yield back to the member businesses driving its circulation.
• Standard Chartered partnered with Circle to launch bank-led USDC minting and redemption services for institutional clients via Dubai’s International Financial Centre (DIFC), with plans for a global rollout. As one of the first global systemically important banks (G-SIBs) to provide direct minting rails, this move integrates stablecoin liquidity into traditional corporate banking, lowering operational barriers for institutional allocators.
• BlackRock integrated Ethena's yield-generating synthetic dollar token, USDe, into its Aladdin risk management platform, while its tokenized BUIDL fund will serve as a primary reserve asset for a new white-label product backed by a $100 million liquidity facility. This deep institutional integration bridges multi-trillion-dollar traditional asset management systems with DeFi-native infrastructure, expanding the reach of tokenized treasury products to mainstream allocators. 
• Crédit Agricole launched EURXT, a MiCA-compliant, euro-pegged stablecoin. Issued by its asset servicing unit, Caceis Bank, the token is backed 1:1 by euro reserves and initially entered circulation with 20 million tokens on the Ethereum network.
• New York Life Investment Management, which manages over $800 billion in assets, made its tokenization debut by launching the NYLIM Anemoy fund, an on-chain, high-yield corporate bond fund strategy on the Centrifuge platform, with transactions settled in USDC.

Catalyst Calendar

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