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: Digital assets continued to outperform broader risk assets, supported by a significant acceleration in ETP inflows, a profit-dominant on-chain regime and a macro backdrop of fiscal-debasement hedging. With Bitcoin trading above key aggregate cost-basis levels and ETPs absorbing a multiple of new supply, market structure remains constructive - although stretched short-term sentiment ("Extreme Greed" at 81, the first since late 2024) warrants some tactical caution.
- Sentiment: The Cryptoasset Sentiment Index is hovering close to its strongest reading since the middle of 2025, fuelled by a sharp climb in the Crypto Fear & Greed Index along with developments in the options market. Because sentiment has warmed so rapidly, a brief dip or period of sideways movement seems probable in the near term - though such a pause wouldn't necessarily undermine the generally positive longer-term picture.
The Cryptoasset Sentiment Index is a composite indicator consisting of 15 different sub-indicators covering sentiment, on-chain, derivatives, flows developments as well as sentiment in traditional financial markets. A 90-day rolling z-score is used to standardise and aggregate these sub-indicators. - Chart-of-the-Week: Pervasive positive net flows into global Bitcoin ETPs are keeping upside pressure on the market, as they are absorbing a multiple (~4x) of the newly minted daily supply of bitcoin.
Chart of the Week
Performance
Last week, digital assets continued to outperform broader risk assets. Bitcoin briefly tested the US$80k–81k area - its largest on-chain supply cluster, coinciding with the 50-week moving average - reaching a 3-month high of ~$81,455 before settling near $77.8k, while Ethereum held around $2,440.
Global equities were comparatively subdued: the S&P 500 was up ~+0.5% and the Nasdaq ~+0.9% on the week - and only after Nvidia's post-earnings rally (+8.7%) lifted semiconductors. This compares with a ~+23% advance in Bitcoin over the trailing two weeks. Meanwhile, gold is increasingly trading alongside Bitcoin, retreating ~2.4% in tandem with Bitcoin on Friday after holding near US$4,600/oz, with both assets benefiting from renewed concerns around fiscal sustainability, dollar debasement and Treasury intervention in bond markets.
On the latter, Scott Bessent has suggested using the Treasury General Account (TGA) to fund the expanded long-end buyback programme. With the TGA sitting near US$1 trn, the Treasury can execute these purchases without immediately financing them through additional bill issuance; at settlement, TGA-funded buybacks return cash to the private sector while retiring longer-duration securities - adding near-term liquidity and removing duration from private hands.
Market participants were also closely watching the communication from the Jackson Hole symposium (27th–29th of August); Chair Warsh's Friday address struck a hawkish tone, warning that inflation is still running too high, calling the 2% objective a "firm, fixed target" and declining to provide forward guidance. As of this morning, Fed Funds Futures now price a ~60% probability of a 25 bp rate hike at the 16-17 September FOMC meeting, up from ~35% on the 27th of August – before the Jackson Hole gathering.
Against this backdrop, institutional demand via ETPs accelerated significantly and remained the dominant marginal buyer of Bitcoin. US spot Bitcoin ETFs attracted around +US$925 mn last week, following +US$1,918 mn the prior week - the largest weekly inflow since early October 2025 - for a cumulative ~+US$2.8 bn over two weeks, led by BlackRock's IBIT.
US spot Ethereum ETFs added around +US$816 mn - surpassing the prior week's +US$693 mn to mark their strongest week since early October 2025 - while US spot Solana ETFs recorded one of their strongest weeks since launch at around +US$143 mn, led by BSOL.
Pervasive positive net flows into global Bitcoin ETPs are keeping upside pressure on the market, as they are absorbing a multiple of the newly minted daily supply of bitcoin (Chart-of-the-Week): with post-halving issuance at ~450 BTC per day, global spot Bitcoin ETPs absorbed ~2,254 BTC per trading day last week - roughly 3.6 x new daily minted supply – despite the net outflows on Friday.
From a market-structure perspective, Bitcoin is now trading above both the Short-Term Holder Cost Basis at ~US$70.6k and the True Market Mean at ~US$76.2k - the average acquisition price of recent buyers and a broader estimate of the market's effective aggregate cost basis, respectively.
In the event of a pullback, a successful retest and hold of these levels as support would provide stronger confirmation that the recent breakout is developing into a more durable risk-on regime. Consistent with this, Bitcoin has shifted back into a profit-dominant regime, with net realised P&L turning decisively positive - consistent with improving liquidity conditions and a broader shift towards risk-on behaviour.
Activity has also picked up across every major Bitcoin trading venue: spot, futures, options, on-chain transfers, ETF turnover and DAT activity have all risen, with derivatives volumes moving toward the upper end of their one-year ranges - breadth that signals strengthening participation across both institutional and native crypto channels.
In general, among the top 10 crypto assets Solana, Monero, Zcash and Hyperliquid were the relative outperformers. Ethereum slightly underperformed bitcoin last week.
Bottom Line: Digital assets continued to outperform broader risk assets, supported by a significant acceleration in ETP inflows, a profit-dominant on-chain regime and a macro backdrop of fiscal-debasement hedging. With Bitcoin trading above key aggregate cost-basis levels and ETPs absorbing a multiple of new supply, market structure remains constructive - although stretched short-term sentiment ("Extreme Greed" at 81, the first since late 2024) warrants some tactical caution.
Sentiment
Our in-house “Cryptoasset Sentiment Index”[1] has softened over the weekend after the previous week's rise to the highest level since late 2024. This decline is in line with last week's report which noted that sentiment was stretched and due some reversion.
At the moment, 12 out of 15 indicators remain above their short-term trend.
The most notable increases are CME Bitcoin Commercials Net Positioning and the Crypto Fear & Greed Index, alongside the BTC 3M basis and BTC 1M 25-delta skew. These suggest leverage and risk appetite have increased, in line with rising cross-asset risk appetite.
The Crypto Fear & Greed Index declined slightly, sitting just below its Index peak of the last bull market on 5 October 2025, albeit remains in "greed" territory. This is consistent with our hot but softening Sentiment Index.
Performance dispersion increased slightly, as all subsectors (AI, L1, meme, L2 and gaming) apart from DeFi produced negative week-on-week returns, suggesting investors favour revenue-generating protocols with a strong tokenisation and stablecoin tailwind.
When dispersion increased, 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 declined to 20% of the altcoins tracked in our index. This is consistent with declining investor sentiment, especially for the assets that are not revenue-generating and instead priced purely on narrative strength.
Sentiment in traditional financial markets as measured by our in-house measure of Cross Asset Risk Appetite (CARA) has increased significantly from 0.75 to 0.85 over the past week, signalling a rise in risk appetite.
The CME Bitcoin Commercials Net Positioning metric captures the difference between long and short CME Bitcoin futures contracts. The reading has declined to -7.82% of open interest, suggesting commercials have continued to unwind short leverage.
Bottom Line: Crypto sentiment softened over the week, consistent with narrowing altcoin breadth as only 20% of tracked altcoins outperformed Bitcoin, with weakness concentrated outside DeFi. Meanwhile, a continued unwind of commercial short positioning on CME points to a healthier, less crowded market structure following the recent short squeeze, though with the short base now thinner, the fuel for another squeeze has diminished.
Fund Flows
Global crypto ETPs experienced around +1753.1 mn USD in net inflows last week, across all types of cryptoassets, after +2756.2 mn USD in net inflows the previous week.
Global Bitcoin ETPs experienced net inflows of +893.7 mn USD last week, of which +899.2 mn USD in net inflows were related to US spot Bitcoin ETFs.
The Bitwise Bitcoin ETF (BITB) in the US experienced net outflows of -16 mn USD last week.
In Europe, the Bitwise Physical Bitcoin ETP (BTCE) experienced net outflows equivalent to -8.9 mn USD, as the Bitwise Core Bitcoin ETP (BTC1) experienced net inflows of around +37.7 mn USD.
The Grayscale Bitcoin Trust (GBTC) posted net outflows of -77.6 mn USD whereas, the iShares Bitcoin Trust (IBIT) experienced net inflows of around +938.3 mn USD last week.
Meanwhile, global Ethereum ETPs experienced +655.9 mn USD in net inflows last week, of which US spot Ethereum ETFs recorded net inflows of around +738.5 mn USD on aggregate.
The Grayscale Ethereum Trust (ETHE) posted net inflows of +3 mn USD, whilst the iShares Ethereum Trust (ETHA) saw net inflows of +567 mn USD.
The Bitwise Ethereum ETF (ETHW) in the US experienced net inflows of +2.3 mn USD last week.
In Europe, the Bitwise Physical Ethereum ETP (ZETH) recorded net inflows of +5.1 mn USD, whilst the Bitwise Ethereum Staking ETP (ET32) saw net inflows of +19.7 mn USD.
Altcoin ETPs ex Ethereum also saw net inflows of +213.4 mn USD last week.
Thematic & basket crypto ETPs posted net outflows of -9.9 mn USD on aggregate last week. The Bitwise MSCI Digital Assets Select 20 ETP (DA20) recorded net outflows of -0.1 mn USD last week.
Bottom Line: Aggregate inflows moderated from the previous week's +2756.2 mn USD but remained comfortably positive, marking another constructive week for the asset class. Bitcoin ETP inflows more than halved week over week, from +1955.1 mn USD to +893.7 mn USD, whilst Ethereum inflows edged higher from +627.3 mn USD to +655.9 mn USD. As a result, Bitcoin's share of total net inflows fell from roughly 71% to 51%, with Ethereum's rising from around 23% to 37%. The pickup in altcoin ex ETH inflows to +213.4 mn USD, from +50.4 mn USD the previous week, points to capital rotating down the risk curve rather than exiting, given total flows remained firmly positive.
On-Chain Data
Following an extremely strong week for Bitcoin and the broader digital asset complex, the market now appears to be consolidating around its newly established higher price levels. This highlights a degree of resilience and staying power across the complex, despite Bitcoin recording its largest weekly dollar gain on record.
Using the deviation of price from its 200-day moving average as a medium-term valuation and momentum measure, Bitcoin remains only moderately elevated despite the recent rally. Headline equity indices continue to trade at comparatively richer historical levels, while gold and silver remain more compressed following their recent corrections. This places Bitcoin in the middle of the cross-asset distribution, suggesting that the recent advance has improved momentum without pushing the asset into historically stretched conditions.
| Asset | Price / 200D MA | Historical Percentile |
|---|---|---|
| Dow Jones | 1.08 | 75.2% |
| S&P 500 | 1.09 | 75.1% |
| Nasdaq | 1.09 | 67.4% |
| Bitcoin | 1.16 | 54.5% |
| Gold | 1.02 | 38.7% |
| Silver | 0.97 | 29.9% |
From a longer-term perspective, however, the relative valuation picture becomes considerably more striking. Bitcoin remains deeply compressed relative to its 200-week moving average, while both precious metals and headline equity indices continue to trade at historically elevated levels. This suggests that, despite Bitcoin’s recent repricing, it remains comparatively early in its longer-term trend recovery and exhibits the greatest degree of historical compression among the assets assessed
| Asset | Price / 200W MA | Historical Percentile |
|---|---|---|
| Gold | 1.59 | 94.6% |
| Silver | 1.84 | 93.2% |
| S&P 500 | 1.39 | 90.8% |
| Nasdaq | 1.48 | 88.6% |
| Dow Jones | 1.30 | 84.8% |
| Bitcoin | 1.24 | 23.5% |
Volumes across major market sectors also remain healthy, providing broader confirmation of the ongoing rally. Participation has strengthened materially across derivatives, ETFs, on-chain activity and DAT markets, suggesting that the move is being supported by a much wider investor base than during the earlier stages of the recovery. Spot activity remains comparatively more moderate, but market engagement on balance is substantially stronger.
Historically, sustained increases in activity across multiple market sectors have tended to accompany more durable rallies, as broader participation provides greater support for the underlying move and reduces the likelihood that price action is being driven by a narrow pocket of speculative demand.
| Market | 7-Day Volume | 1-Year Percentile |
|---|---|---|
| Spot | $55.9bn | 44.8% |
| Futures | $423.6bn | 76.5% |
| Options | $55.4bn | 97.0% |
| On-chain | $50.6bn | 69.9% |
| ETF | $20.8bn | 72.1% |
| DAT | $22.8bn | 94.3% |
Notably, several signs of a transition from risk-off to risk-on conditions are now emerging. Investor profitability has improved substantially, with a large share of supply moving from loss into profit. This balance-sheet improvement has also begun to translate into spending behaviour, with profit-taking now exceeding loss-taking for the first time since November 2025. This is an important characteristic of a risk-on environment, as steadily improving liquidity can help support higher asset prices and valuations.
Importantly, Bitcoin has also remained above several key cost-basis and technical levels, highlighting a degree of resilience despite the speed of the recent advance. We have repeatedly highlighted the 200-day moving average near $69k and the Short-Term Holder cost basis near $70k as important measures of local market momentum, both of which have now been decisively reclaimed. More recently, price has also moved above the True Market Mean near $76k, representing a broader market equilibrium level.
However, despite the strength of the move, near-term conditions may be becoming somewhat overheated. Price is now approaching the plus one standard deviation band around the Short-Term Holder cost basis near $81k. Across the previous cycle, moves beyond this threshold were frequently associated with locally elevated conditions and increased sell-side pressure, suggesting that the market may require time to digest the recent advance.
From a technical perspective, a decisive reclaim of the $83k level would establish a new higher high on the monthly timeframe, providing further confirmation that the prevailing downtrend has reversed. Alongside this, the ETF inflow cost basis also sits near $83k. The confluence of these measures reinforces the importance of the $81k-$83k region, with a decisive move through this zone likely representing an important threshold for the market to progress into the next stage of the bull cycle.
Futures, Options & Perpetuals
Over the past week, BTC perpetual futures open interest declined by approximately 23k BTC, falling from around 468k BTC to 444k BTC. The seven-day contraction ranks among the largest on record, highlighting a substantial unwind in leveraged positioning following the recent rally. However, absolute open interest remains elevated, suggesting that despite the scale of the deleveraging, a substantial amount of positioning remains embedded across perpetual futures markets. CME open interest also declined by approximately 6.2k BTC, pointing to a moderate unwind in institutionally oriented futures positioning.
Perpetual funding rates, measured on a seven-day moving average, ended the week positive at approximately 6.4% annualised, slightly below the previous week. Futures positioning therefore remains long-biased, although the willingness of investors to pay for upside exposure appears to be moderating.
Across options markets, BTC open interest on major exchanges increased by approximately 67k BTC, marking another week of expanding positioning ahead of month-end expiry. This suggests that investor engagement across the options market remains elevated, although some of the increase may reflect contracts being rolled into later maturities rather than entirely new positioning.
The put-to-call open interest ratio across major crypto-native exchanges also increased modestly to 0.60, indicating a greater relative concentration of positioning in puts. The equivalent ratio across IBIT options rose to 0.71. Using the distinction between crypto-native and institutional venues as a crude proxy, this suggests a degree of convergence in positioning, with both investor groups placing greater emphasis on downside protection.
At the same time, 25-delta skew remains deeply negative across all tenors following last week’s sharp decline. This indicates that downside protection remains relatively cheap compared with upside exposure, despite the increase in put positioning. Importantly, these observations are not contradictory. Put-to-call open interest measures the quantity of outstanding positioning, while skew captures the relative price investors are paying for that protection.
Total gamma exposure, measured on a seven-day moving average, swung sharply from positive $6.6bn to negative $2.2bn. Negative gamma can amplify price moves in either direction, as procyclical dealer hedging may require selling into declines and buying into rallies. The largest negative gamma concentrations are clustered around $78k, $80k, $82k and $85k, suggesting that price movement through this region could experience amplified volatility while this positioning remains in place.
On balance, derivatives positioning has undergone a meaningful reset, with one of the largest weekly contractions in perpetual futures open interest on record. However, absolute positioning remains elevated, options open interest continues to build, downside protection remains relatively cheap compared with upside exposure, and total gamma has flipped decisively negative. Taken together, this suggests that speculative excess has been partially reduced, while the derivatives market remains vulnerable to elevated volatility around current price levels.
Bottom Line
- Performance: Digital assets continued to outperform broader risk assets, supported by a significant acceleration in ETP inflows, a profit-dominant on-chain regime and a macro backdrop of fiscal-debasement hedging. With Bitcoin trading above key aggregate cost-basis levels and ETPs absorbing a multiple of new supply, market structure remains constructive - although stretched short-term sentiment ("Extreme Greed" at 81, the first since late 2024) warrants some tactical caution.
- Sentiment: The Cryptoasset Sentiment Index is hovering close to its strongest reading since the middle of 2025, fuelled by a sharp climb in the Crypto Fear & Greed Index along with developments in the options market. Because sentiment has warmed so rapidly, a brief dip or period of sideways movement seems probable in the near term - though such a pause wouldn't necessarily undermine the generally positive longer-term picture.
The Cryptoasset Sentiment Index is a composite indicator consisting of 15 different sub-indicators covering sentiment, on-chain, derivatives, flows developments as well as sentiment in traditional financial markets. A 90-day rolling z-score is used to standardise and aggregate these sub-indicators. - Chart-of-the-Week: Pervasive positive net flows into global Bitcoin ETPs are keeping upside pressure on the market, as they are absorbing a multiple (~4x) of the newly minted daily supply of bitcoin.
Appendix
Data subject to change
Combined positioning = futures and options in % of Ol
Notes
[1] The Cryptoasset Sentiment Index is a composite indicator consisting of 15 different sub-indicators covering sentiment, on-chain, derivatives, flows developments as well as sentiment in traditional financial markets. A 90-day rolling z-score is used to standardise and aggregate these sub-indicators.
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