This report is for professional investors and information purposes only. Persons without professional investment experience should not rely on it. Not investment advice or a personal recommendation. Cryptoassets are high risk and volatile and you may lose all capital invested. See full risk information at the end of this document.
- Performance: Last week, cryptoassets continued to recover as bitcoin outperformed both US equities and gold as major central banks kept rates unchanged despite rising inflation. This has contributed to an increase in risk appetite across both traditional financial markets and crypto markets.
- Cryptoasset Sentiment Index: Our in-house “Cryptoasset Sentiment Index” has continued to improve and is now signalling stretched sentiment in the short term. It is now at the highest reading since May 2025.
- Chart-of-the-Week: High sentiment readings imply that bitcoin could continue to consolidate in the short term as positioning have become one-sided which tends to signal short-term buyer fatigue.
Chart of the Week
Performance
Last week, cryptoassets continued to recover as bitcoin outperformed both US equities and gold as major central banks kept rates unchanged despite rising inflation. This has contributed to an increase in risk appetite across both traditional financial markets and crypto markets.
As pointed out in our previous Crypto Market Compass and Bitcoin Macro Investor reports, key pricing levels continue to reside between the $80k-$85k price range which we identified as key “demarcation line” between bull and bear market (see reports above).
In this context, it is worth highlighting that our Cryptoasset Sentiment Index has increased significantly over the past week which may imply that the recent recovery is somewhat stretched and may revert to the downside in the short term (Chart-of-the-Week).
While low readings of the Cryptosset Sentiment Index tend to signal short-term seller exhaustion, high readings tend to signal short-term buyer fatigue.
In fact, some sub-sectors have been signalling stretched sentiment and one-sided positioning more recently such as the Crypto Fear & Greed Index, crypto dispersion, and bitcoin's implied volatility. On the other side, indicators like the 3-months bitcoin basis rate, overall fund flows into crypto ETPs, as well as CME futures positioning indicators are still subdued, and relatively bearish but overall readings are already relatively bullish on aggregate. In our analytical framework, this pattern has historically functioned as a contrarian indicator, though past patterns may not repeat.
That being said, we continue to hold the analytical view that we may be in the late stages of a bear market bottoming process.
As highlighted in our latest Bitcoin Macro Investor report, both the coin transfer model and the long-term holder percentage supply in profit and loss have, in prior cycles, been associated with conditions that preceded cyclical bottoms. Based on current readings, these models suggest a potential bottoming window could emerge over the coming months , though the timing and outcome remain highly uncertain and model-dependent.
The rationale underlying both models is based in the notion that a cyclical bottom usually occurs the moment the majority of bitcoins have been transferred from “weak hands”, rather unsophisticated short-term investors with low conviction to “strong hands”, rather sophisticated long-term investors with high conviction. In fact, we are observing increasing on-chain evidence that implies that this process may already be relatively advanced.
Cryptoasset markets will probably focus on this week's mark-ups of the US CLARITY Act. The May 14th mark-up matters because it's the Senate Banking Committee's first formal vote on the bill since the January postponement, and clearing committee is the gating step before a full Senate floor vote.
The White House is targeting the 4th of July for final passage, with four working Senate weeks in June for floor action - though that timeline depends on the mark-up going smoothly. Polymarket odds for a passing of the bill in 2026 have recently increased to 75% which may act as a bullish catalyst for cryptoasset markets due to higher regulatory clarity in the US.
In general, among the top 10 crypto assets ZCash, Solana, and Cardano were the relative outperformers. Ethereum underperformed bitcoin last week.
Sentiment
Our in-house “Cryptoasset Sentiment Index” has continued to improve but now potentially signals short-term buyer fatigue with stretched sentiment. It remains at the highest level since May 2025.
At the moment, 13 out of 15 indicators are above their short-term trend.
Last week, CME Net Positioning, Funding Rates, and Exchange Inflows all flipped positive, signalling a short squeeze likely fuelled the recent outperformance. However, this shift suggests a tactical pivot toward profit-taking, as rising inflows indicate investors may be preparing to sell into the current strength.
The Crypto Fear & Greed Index declined slightly last week but currently signals a “neutral” level of sentiment. It still remains at highs since mid-January.
Performance dispersion increased last week as the DeFi sector outperformed, led by Jupiter, a decentralised exchange that has partnered with Securitize, a tokenisation platform, to launch fully on-chain, regulated trading for tokenised equities on the Solana network.
When dispersion increases, it may indicate that the market appears to be driven by a more diverse set of narratives which, in our analysis, has historically been associated with periods of increasing risk appetite in prior market cycles.
Altcoin outperformance vis-à-vis Bitcoin increased significantly by 35%-points last week, to 75% of our tracked altcoins in the index outperforming. However, Ethereum underperformed Bitcoin.
Sentiment in traditional financial markets as measured by our in-house measure of Cross Asset Risk Appetite (CARA) stayed flat at 0.81 over the past week, signalling risk appetite is positive but measured and not overly stretched in traditional financial markets.
CME Bitcoin Commercials Net Positioning, which shows the difference between long and short CME Bitcoin futures contracts decreased significantly from –10.5% to –6.41% of open interest suggesting short leverage unwound contributing to Bitcoin's outperformance. As anticipated in previous reports, the downside was becoming overly crowded, with this forced covering providing a mechanical tailwind for the price.
Despite this recent unwind, it is still worth mentioning that short positioning still remains historically elevated which could still lead to increased volatility if the negative net positioning were to reverse.
Fund Flows
Bitcoin products propelled large net inflows into global crypto ETPs compared to last week; but performance across other sectors was mixed. Ethereum and Altcoin Ex-ETH products saw marginal interest, whereas Basket and Thematic products registered net outflows.
Global crypto ETPs saw around +740.2 mn USD in weekly net inflows across most types of cryptoassets, after + 33.4 mn USD in net inflows the previous week.
Global Bitcoin ETPs continued to experience net inflows of +641.9 mn USD last week, of which +597.5 mn USD in net inflows were related to US spot Bitcoin ETFs.
The Bitwise Bitcoin ETF (BITB) in the US experienced net outflows, totalling -10.6 mn USD last week.
In Europe, the Bitwise Physical Bitcoin ETP (BTCE) experienced net outflows equivalent to -5.4 mn USD, as the Bitwise Core Bitcoin ETP (BTC1) experienced net inflows of +5.6 mn USD.
The Grayscale Bitcoin Trust (GBTC) posted net outflows of –62.3 mn USD and the iShares Bitcoin Trust (IBIT) experienced net inflows of around +596.3 mn USD last week.
Meanwhile, global Ethereum ETPs experienced +66.7 mn USD in net inflows last week, of which US spot Ethereum ETFs recorded net inflows of around +64.5 mn USD on aggregate.
The Grayscale Ethereum Trust (ETHE) posted net outflows of -8.4 mn USD whilst the iShares Ethereum Trust (ETHA) saw net inflows of +100.1 mn USD.
The Bitwise Ethereum ETF (ETHW) in the US experienced no net inflows last week.
In Europe, the Bitwise Physical Ethereum ETP (ZETH) recorded net outflows of –1.1mn, as the Bitwise Ethereum Staking ETP (ET32) saw +2.4 mn USD of net inflows.
Altcoin ETPs ex Ethereum experienced net inflows of +38.7 mn USD last week.
Thematic & basket crypto ETPs posted small net outflows of -7.1 mn USD on aggregate last week. The Bitwise MSCI Digital Assets Select 20 ETP (DA20) experienced no net inflows.
On-Chain Data
Bitcoin experienced another strong week of price action, reaching a high of just under $83k before closing the week around $81k. Price now sits just above the neckline of the initial November contraction that marked the beginning of the current bear market regime.
Furthermore, price continues to oscillate around the Short-Term Holder cost basis (STH-CB) at $80k, representing the average acquisition price of newer market participants, and the True Market Mean (TMM) at $79k, reflecting the average cost basis of active investors. As highlighted in previous editions, these levels have historically acted as key thresholds that must be reclaimed and held for momentum to re-establish.
Complementing the assessment of key pricing levels, the 200-day moving average currently sits at $83k, aligning closely with this week's local high, where price encountered resistance. The 200-day moving average, STH-CB, and TMM each represent variants of local and macro momentum indicators. Historically, the convergence of these pricing levels has marked important inflection zones, often acting as decisive thresholds between risk-on and risk-off market regimes.
Additionally, Long-Term Holders (LTHs), representing a mature investor cohort defined by coin holding time, now hold approximately 14.8mn BTC, just shy of the all-time high of 14.85mn. This suggests that coins are not circulating freely, with HODLing remaining the dominant market behaviour. Historically, as supply migrates toward more inert and less active investors, supply-side conditions tend to tighten, contributing to thinner order books and a more fragile market structure. This leaves the market increasingly sensitive to demand-side shocks in either direction.
This dynamic is further reflected in the Sell-Side Risk Ratio, which measures the intensity of capital flows across the network by comparing the combined profit and loss realised to total invested capital. At present, only 0.68% of trading days have recorded a lower reading, reinforcing that capital flows remain very limited and that on-chain liquidity conditions are extremely tight. Historically, such conditions have often preceded market moves that re-engage supply and unlock latent investor liquidity, contributing to elevated volatility conditions.
Spot volume at $5.8bn and futures volume at $33.7bn remain historically low, sitting in the 2nd and 3rd percentiles across the past three years, respectively. This further supports the view that subdued on-chain activity is being mirrored across both spot and futures venues, highlighting limited liquidity and a fragile market structure.
Furthermore, Bitcoin continues to dominate market structure, with correlation and beta percentiles (180-day) across the altcoin complex remaining extremely elevated at 100% respectively, indicating a predominantly single-factor environment centred on Bitcoin. This suggests that volatility in Bitcoin is likely to transmit across the altcoin complex, with altcoins acting as amplified expressions of BTC price movements.
Despite the recent uptick in price action, Bitcoin market structure remains fragile, with muted volumes across both spot and futures venues. Across on-chain dynamics, supply continues to migrate toward Long-Term Holders, causing coins to accumulate in statistically inert hands and contributing to tighter supply-side conditions. With a large share of recent supply movement occurring near prevailing spot prices, liquidity appears highly constrained from the perspective of profit- and loss-taking dynamics, with the Sell-Side Risk Ratio sitting at historical lows. Notably, with price oscillating around the aforementioned resistance cluster alongside an uptick in volatility expectations, the market sits at a decisive point in the formation of the next prevailing trend.
Futures, Options & Perpetuals
Over the past week, BTC perpetual futures open interest declined by approximately -4.46k BTC, while CME futures open interest rose by around +1k BTC versus the prior week. That combination suggests some leverage continued to come out of offshore perpetuals, although at a slower pace than the previous week, while positioning in more institutionally oriented venues increased modestly. Aggregate futures liquidations picked up slightly from the prior week. In total, liquidations reached roughly $2.22bn over the week, with long liquidations of $0.88bn and short liquidations of $1.34bn.
On the back of reports suggesting possible progress toward a US-Iran de-escalation deal, BTC rallied as high as $82k, clearing liquidity pockets in the $80k to $81k area and driving a wave of short liquidations. Price has since reversed some of those gains following news that Iran had not accepted the terms of the deal. Liquidity is now forming around $79k on the downside and $83k on the upside, giving the market a relatively tight but slightly higher range to trade against in the near term.
Perpetual funding rates, measured on a 7-day moving average, remained around -2%, unchanged from last week. That suggests futures positioning stayed notably cautious despite the rally, with the move higher in spot still failing to generate a sustained build in aggressive long exposure.
At the same time, the BTC 3-month annualised basis ticked down to around 2.1%. That leaves the futures curve still relatively flat, reinforcing the view that the market is not yet pricing in a strong bullish impulse over the next few months.
In options markets, BTC Deribit options open interest increased modestly by roughly +20.5k BTC, bringing total open interest up to 376k BTC. The Deribit put-to-call open interest ratio increased slightly to 0.64, while the equivalent metric across IBIT options also moved higher to 0.68 by week's end.
Taken together, these moves suggest options exposure rebuilt modestly while downside protection demand increased slightly across both crypto-native and ETF-linked options markets. The rise in Deribit open interest points to a moderate increase in overall exposure, while the move higher in both put-to-call ratios suggests positioning became somewhat more balanced, with investors adding or retaining more downside hedges after the rally.
The 25-delta skew was mixed across the curve during the week, rising slightly at the short end, including the 1-week and 1-month tenors, while moving lower in the 3-month and 6-month tenors. That points to a market where near-term downside protection became somewhat more expensive, even as medium-dated hedging demand eased modestly.
Total GEX, on a 7-day moving average basis, declined from $1.2bn to $0.43bn. This suggests dealer positioning has become lighter again, reducing the scale of hedging flows that might otherwise amplify spot moves. In practical terms, the market may now be somewhat less mechanically reactive than it was a week ago.
Dealer gamma exposure also remains predominantly negative, with the bulk of negative gamma still clustered around the $82k strike. That leaves the market most sensitive to a move back toward that level. By contrast, positive gamma has shifted higher to the $85k to $90k area, suggesting any stabilising dealer flows now sit meaningfully above current spot levels.
Bottom Line
- Performance: Last week, cryptoassets continued to recover as bitcoin outperformed both US equities and gold as major central banks kept rates unchanged despite rising inflation. This has contributed to an increase in risk appetite across both traditional financial markets and crypto markets.
- Cryptoasset Sentiment Index: Our in-house “Cryptoasset Sentiment Index” has continued to improve and is now signalling stretched sentiment in the short term. It is now at the highest reading since May 2025.
- Chart-of-the-Week: High sentiment readings imply that bitcoin could continue to consolidate in the short term as positioning have become one-sided which tends to signal short-term buyer fatigue.
Appendix
Data subject to change
Combined positioning = futures and options in % of Ol
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