Last week (May 20 - May 26), BTC price lost momentum after multiple attempts to break $110,000, quickly retracing and entering a high-level consolidation phase. From May 21 to 23, BTC strongly pushed upward, breaking the important psychological level of $110,000, creating a new stage high of $111,980 before a slight pullback. Subsequently, due to significantly weakened bullish momentum, BTC failed multiple attempts near $111,000 and quickly entered a oscillating consolidation range. As of May 27, BTC price stabilized around $109,741, with a maximum weekly gain of 7.48%.
Last week, ETH trend largely followed BTC. Influenced by Trump's dinner and concerns about US-European tariff wars, trading volume increased from May 22 to 23, with bulls and bears in a stalemate. ETH price rose to a high of $2,734.23 before quickly dropping below $2,500, then entering an oscillating consolidation phase. Currently, ETH price is around $2,638, with a maximum weekly fluctuation of 11.94% (data source: Binance spot, May 27, 17:13).
Market Interpretation
BTC and ETH Spot ETFs Strongly Attracting Funds, Continuous Capital Momentum Release
Since May, BTC spot ETF has shown significant fund attraction. As of May 26, BTC spot ETF cumulative net inflow has reached $44.53 billion. Only 2 trading days in the month saw small net outflows, with the rest being net inflows. Among these, 4 days had single-day net inflows exceeding $600 million, with over 80% of trading days having net inflows higher than $200 million.
ETH spot ETF also shows a warming trend. Since trading began on May 12, only 2 net outflows occurred. On May 22, single-day net inflow reached $110 million, creating a new high since February, reflecting rapid market acceptance of ETH spot ETF.
The strong inflows of BTC and ETH spot ETFs are continuously strengthening market fund expectations, becoming an important supporting factor for the current mainstream cryptocurrency market.
"One Big Beautiful Bill Act" Combined with Tariff Upgrade Expectations, Market Risk Appetite Adjusts
On May 22, the US House of Representatives passed President Trump's "One Big Beautiful Bill Act", proposing to raise the debt ceiling from the current $36.1 trillion to $40.1 trillion, at which point US debt balance will approach 140% of GDP.
Changes in fiscal prospects triggered market reassessment of US debt repayment capacity. This week, US 10-year Treasury yield returned to the 4.5% high. Rising bond yields combined with new policy uncertainties pressured major US stock indexes. As of May 26, the three major indexes fell over 2% this week, with Dow dropping 250 points, S&P 500 down 0.7%, and Nasdaq down 1%.
The US dollar index retreated this week, its first decline in four weeks, with a weekly drop of 1.03%, touching a three-week low. Gold prices remained relatively strong, with London gold rising 1.98% this week, closing at $3,359.90/ounce on May 26.
US-EU Trade Tensions Ease, Short-term Risk Aversion Cools
On May 23, US President Trump publicly criticized the EU for structural unfairness in trade, announcing 50% high tariffs on EU products from June 1, triggering increased global market risk aversion. On May 26, the EU released a conciliatory signal, announcing accelerated trade negotiations with the US. After a phone call between European Commission President von der Leyen and Trump, both sides agreed to closely consult and extend tariff negotiation periods. The originally scheduled taxation date was postponed to July 9.
In the short term, the risk of trade friction escalation is temporarily relieved, pressuring safe-haven asset prices. Investors are advised to continue monitoring subsequent US-EU negotiations and the impact of Trump's policy expectations on global asset allocation.
BTC Oscillates at High Levels, Institutional-Driven Trading, Retail Participation Remains Low
Last week, BTC price broke through $111,000, creating a historical high, but trading structure indicates this round of rise is primarily driven by institutions. Google Trends data shows "BTC (Bitcoin)" keyword search heat is far lower than the same period in 2021, with limited retail participation.
Derivatives market shows traders remain cautious. As of May 23, Binance BTC/USDT perpetual contract "large account long-short ratio (position)" is 1.61, showing bullish dominance but already fallen from previous levels. The "total account long-short ratio" is 0.46, reflecting low retail bullish proportion.
Market Highlights
Crypto Narrative Enters Political Domain, Trump Dinner Releases Symbolic Signal
On the evening of May 22, former US President Trump held a VIP dinner at the National Golf Club, inviting guests holding his personal tokens. On-chain assets officially entered high-level political activities as an identity access mechanism for the first time. Trump again expressed support for crypto and proposed the idea of "establishing a US BTC reserve".
BTC Conference Approaching, Short-term Volatility May Turn
Traders are focusing on the BTC Conference held from May 27 to 29 in Las Vegas. QCP Capital states that short-term market sentiment remains defensive, with BTC implied volatility still high, expecting volatility to gradually decrease after key speeches, potentially bringing market direction selection.
Hong Kong Legislation Advances Stablecoin Regulation, Compliance Process Accelerates
On May 21, Hong Kong's Legislative Council passed the "Stablecoin Regulation Bill" in third reading, establishing a licensing system for fiat stablecoin issuers. Compliant stablecoins are expected to land by the end of the year, bringing policy clarity to the virtual asset ecosystem.
Disclaimer: The above content does not constitute investment advice, sales offer, or purchase offer invitation to residents of Hong Kong Special Administrative Region, United States, Singapore, or other countries or regions where such offers might be legally prohibited. Digital asset trading may involve significant risks and instability. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.
