Weekly Market Insight: May Week 3

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Market Updates

12 May 2025

Headline News

Bitcoin has benefited from growing optimism surrounding potential trade deals between the US and both the UK and China, Bitcoin price increased by 10.42% last week. Institutional adoption continues to expand, with major players like Stripe and Robinhood integrating cryptocurrency, and New Hampshire making headlines as the first US state to establish a Bitcoin reserve. Meanwhile, Ethereum's successful Pectra upgrade marked a potential turning point, with ETH outperforming Bitcoin by 18% in the past week, its strongest weekly performance since May 2024. However, on-chain gas burn for Ethereum remains relatively unchanged. This week’s ETH ETF net inflows will be key to watch for further signs of investor sentiment.

Macro-Outlook

The US and UK have announced a trade deal cutting UK car tariffs to 10%, eliminating steel tariffs, boosting US ethanol and beef exports, while maintaining UK food standards.
The US and China started the trade deal talk in Geneva. Both counties' representatives expressed significant progress made during the two-day talk. On May 12, the US announced reducing tariffs on Chinese goods from 145% to 30%, while China announced reducing tariffs on US goods from 125% to 10%, both reductions will be effective for 90 days.
India-Pakistan tensions escalated with mutual airstrikes after a Kashmir massacre. A US-mediated ceasefire was agreed but violated, with ongoing clashes and civilian casualties reported.
Russia is expected to have peace talks with Ukraine on May 15 in Istanbul.
The US ISM services PMI in April increased to 51.6, higher than market expectation of 50.6.
The US Federal Reserve kept the rate unchanged in the May FOMC meeting, citing the current monetary policy is well positioned to wait for greater clarity before considering any adjustments. Private domestic final purchases (PDFP), which exclude net exports, inventory investment and government spending, grew at 3% in Q1 2025, indicating different perspectives from the negative GDP during the same period.

Upcoming Economic Calendar including,

Tuesday, May 13, 8:30pm: The US Inflation Rate in April
Thursday, May 15, 8:30pm: The US PPI and Retail Sales in April
Friday, May 16, 10:00pm: The University of Michigan Consumer Sentiment for the US in May

Weekly-Cryptos-Overview

Stripe introduced 60 new upgrades, including stablecoin in its optimised checkout suite, Stablecoin Financial Account for businesses to receive and pay stablecoin, and USDC-denominated Visa card.
Bridge introduced USDB, backed with cash and money market funds. Bridge was acquired by Stripe in October 2024 with $1.1 billion in valuation.
Strike, the Bitcoin payment app founded by Jack Mallers, has announced Strike Lending, a crypto lending platform.
Strive plans to merge with publicly traded company Asset Entities to offer a tax-free Bitcoin to equity exchange to investors. Eligible investors are able to exchange their BTC holdings for equal worth of shares without being subjecting to capital gains tax. The tax liability is deferred until the shares are sold.
Coinbase introduced x402, a new open source payment protocol built on HTTP rails. This enables a new pay-per-use model, such as paying for each AI token consumed, paying for each word loaded, and paying for each minute of content watched.
Coinbase also partnered with Riot Games to become the exclusive crypto-exchange and blockchain partner for LoL and Valorant global esports events.
Coinbase acquired Deribit, the leading crypto option exchange for $2.9 billion, marked as the largest acquisition in history of the crypto industry.
Meta is reportedly exploring the use of stablecoins for cross-border payments, 3 years after abandoning the Libra project. Meta is in discussion about using cryptocurrencies across its platforms and reducing cost in payout management.
Robinhood is reportedly planning to offer US securities trading to European retail investors via a blockchain-based platform (Arbitrum and Solana are under consideration).
New Hampshire has become the first state to enact Bitcoin Reserve legislation, allowing the state treasurer to invest up to 5% of state funds in precious metals and digital assets with at least $500 billion market cap. SB1373 Bitcoin Reserve Bill from Arizona, which allows the state to invest not more than 10% of approved funds into digital assets, is still pending final approval from Governor Hobbs. However, Governor Hobbs has approved a separate bill, HB2749, to establish the Bitcoin and Digital Assets Reserve Fund. Texas Strategic Bitcoin Reserve bill, SB21, which allows a special fund to invest in cryptocurrency with at least $500 billion market cap, is proceeding to the full vote on the House floor before June 2.
The US OCC clarified that national banks and federal savings associations can engage in crypto-asset custody, trading, and stablecoin services without prior approval, provided they maintain robust risk management, while rescinding earlier restrictive guidance.
The stablecoin legislation, GENIUS Act, failed to pass the Senate vote. Several Democrats expressed concerns about lack of anti-money laundering and national security requirements in the bill. The new revised GENIUS Act includes foreign stablecoin issuers that serve US users to comply, and broadens the definition of digital asset service providers to include developers, validator nodes and self-custodian wallet providers to comply with Bank Secrecy Act and AML regulations.
The SEC is considering a potential exemptive order to allow firms to use distributed ledger technology to issue, trade, and settle securities. This would help resolve regulatory barriers and enable the deployment of new products and services.

Layer 1 and Layer 2s

Ethereum has completed the Pectra upgrade, introducing smart account wallet features, increasing Layer-2 blob by 2x and improving validator staking experience.
Unichain has implemented TEE sequencing, protecting transactions from MEV and verifiable independently.
Polygon announced CDK OP Stack as part of its Multistack plan. Developers now can use OP Stack with ZK pessimistic proof to eliminate 7-day fraud-proof withdrawal delay and remove Superchain tax.
Tether onboarded on Kaia network to expand stablecoin support across LINE's Mini Dapp platform.
ZKsync is now fully EVM Equivalent, enabling seamless developers experience in protocol onboarding and integration.
Berachain's Boyco claims are live. TVL of Berachain has decreased by 45% since May.
Monad launched Testnet-2, targeting validators for helping optimize decentralization at launch. The testnet will last for 10 weeks, potentially pushing the mainnet launch in Q3 2025.
Particle Network announced the first cohort of Universal Account integrators that joins UniversalX as the first-ever chain-agnostic dApps.

Dapps

Aave announced the Horizon protocol has partnered with Ant Group to establish a custom RWA market on Ethereum.
Superstate, an RWA platform and issuer of USTB, introduced Opening Bell, which is a new platform for companies to issue SEC registered shares directly onto blockchain. SOL Strategies will be the first issuer to bring their shares on-chain.
Space and Time’s native token, SXT, is now live. It serves multiple purposes: as a staked asset for validators to ensure the integrity of data verified by its ZK coprocessor, as an incentive for data providers, and as a payment token for querying and inserting data.
Chainlink introduced Chainlink Reward, allowing Chainlink Build projects to distribute their tokens to participants and LINK stakers. Space and Time is distributing 2% of its token supply to LINK stakers via Chainlink Reward.
Boop.fun launched its BOOP token. Boop.fun is a celebrity-meme-launchpad on Solana, in which graduated tokens will be moved to Raydium. BOOP tokens will be rewarded to the creators and "cult members" daily, and BOOP stakers will get 60% of all SOL trading fees, airdrops from graduated tokens and 30% of trading fees will be used for BOOP buyback.
Superseed, self-repaying loan protocol, has launched its native token, SURP. SURP will be the first Supercollateral to enjoy 0% interest borrowing and self-repaying debt.
Obol, the decentralised validator network protocol, has launched its OBOL token for governance and retroactive funding purposes.
Kaito has released a dashboard to display the Total Distribution Value (TVD) for users to have a better understanding of how much rewards have distributed to yappers, stakers and holders.
Zerebro's co-founder, Jeffy Yu faked his death with staged suicide video footage and false obituary on legacy.com.
Across introduced Across Prime, where instead of users' funds are locked in an escrow contract during the intent transaction, Across Prime allows funds to be directly transferred to the relayers with bonding model, potentially saving on gas and faster capital turnover.
Doodles, an Ethereum NFT collection, has launched its native token DOOD on Solana.
Backpack has launched Lend SOL, introducing 12.24% APY stacks yield from lending and staking, while serving as perpetual collateral on the exchange.
ListaDAO partnered with World Liberty Finance to offer USD1 in its lending market.
Resolv, a dual-tranche delta neutral stablecoin, introduced its RESOLV tokenonomics. The token will launch with 20% initial supply with utilities such as governance, emission reward, partner protocol rewards, and boosted point multipliers.

Upcoming Alpha and Governance

Fluid is expected to release a multichain expansion announcement next week. Community members speculate the upcoming announcement might be onboarding Solana.
The US SEC is having a roundtable to discuss onchain tokenisation on May 12.
Stacks non-custodian wrapped Bitcoin (sBTC) is expected to have Cap-3 launch on May 15.
Sonic is expected to release an announcement related to sharding on May 15.
InfiniFi raised $3 million led by Electric Capital. InfiniFi splits a yield vault into liquid-yielding assets and illiquid durational yielding assets such as Pendle, enabling vault holders to enjoy a higher "semi-liquid-yield".
Donald Trump is having a Gala dinner with Top 220 TRUMP holders on May 22.
Liquity v2 is expected to redeploy in mid-May.
Taiko has started to transfer protocol ownership to Taiko DAO. The process is expected to be done by June 2025, decentralising protocol governance.
Aave passed the proposal to add PEPE as a supported collateral asset on the AAVE lending platform.
AAVE proposed to Uniswap to integrate Uniswap V4 LP as collateral in Aave to borrow against GHO. Aave would share 50% of the GHO borrowing profit to Uniswap. In return, Aave requested $3.3 million worth of UNI as an 18-month working capital, 1.1 million UNI as ecosystem allocation, and 1.2 million UNI for liquidity incentives.
Curve Finance proposed to remove veCRV whitelist allowing fully permissionless CRV locking. Although the proposal doesn't directly introduce increasing demand for locking CRV, the changes allow CRV that preferred to be held in multisig to participate in governance and developers can now experiment veCRV with other yield boosting strategy.
Berechain proposed a new tokenomics change, POL v1.1, by implementing a fixed initial 20% fee on incentives distributed to BGT boosters, and redirecting part of the rewards into Chain Owned Liquidity (COL) such as BERA/HONEY pair.
Sei Network proposed ending support for CosmWasm due to lack of Cosmos native adoption in the past and EVM-only architecture will simplify Sei developer and user experience.
Stargate passed the proposal to integrate Espresso Network, significantly increasing the cross-chain confirmation between supported chains without reorg-risk.
Lido proposed Dual Governance, LIP-28, introducing stETH holders to voice their intention to quit in the event of controversial proposal. The proposal includes example: if 1% of stETH expressed quitting, the proposal execution will be delayed, if 10% of stETH expressed quitting, the proposal execution will be halted.

Token Unlock

APTOS token unlocked on May 12, amount representing 1.83% of the token supply.
IMX token unlocked on May 16, amount representing 1.35% of the token supply.
ARB token unlocked on May 16, amount representing 1.95% of the token supply.
VANA token unlocked on May 16, amount representing 1.47% of the token supply.
APE token unlocked on May 17, amount representing 1.93% of the token supply.
MELANIA token unlocked on May 20, amount representing 5.67% of the token supply.
PLUME token unlocked on May 21, amount representing 5.43% of the token supply.
INIT token unlocked on May 24, amount representing 1.68% of the token supply.
GRASS token unlocked on May 31, amount representing 1.34% of the token supply.
OP token unlocked on May 31, amount representing 1.94% of the token supply.
SUI token unlocked on June 1, amount representing 1.75% of the token supply.
ENA token unlocked on June 2, amount representing 1.62% of the token supply.

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