Risk-Off Reversal: Macro Headwinds Shake Markets
Markets faced heavy selling pressure as U.S. tariff concerns spooked investors, sending Bitcoin (BTC) down to $91K. A temporary tariff delay for Canada and Mexico helped stabilize risk sentiment, fuelling a rebound to $102K.
Bitcoin: Stuck in a Tight Range
After bottoming at $91K on January 31, BTC recovered but remains trapped between $96K–$102K. Momentum is lacking, with no clear breakout in sight. Meanwhile, U.S. spot Bitcoin ETFs saw $32M in inflows by Thursday, bringing total holdings past $40B.
Regulatory Tailwinds: U.S. States Move Toward Bitcoin
Utah became the first U.S. state to approve a 5% public fund allocation to Bitcoin, with 15 others—including Arizona, Illinois, and Texas—exploring similar moves. Meanwhile, the Senate Banking Committee pushed for fair banking access for crypto firms, and the GENIUS stablecoin bill signals a shifting regulatory landscape that could legitimize digital assets further.
Aave: DeFi’s Strength in Volatile Markets
Aave processed $200M in liquidations without incurring bad debt, proving DeFi's resilience under stress. The protocol's lending book has grown to $26.55B, reinforcing the efficiency of smart contract-based finance. With stablecoin regulation advancing, fiat-backed, on-chain stablecoins are poised to challenge centralized finance (CeFi) lending and traditional credit markets.
Metaplanet: Japan’s Big Bitcoin Bet
Metaplanet has seen its market cap soar 7,000% since adopting the Bitcoin Standard in 2024. Now, the company is raising $745M to purchase 21,000 BTC by 2026, mirroring MicroStrategy’s playbook. As more firms follow suit, BTC supply constraints could become a key issue. Institutions may turn to direct miner purchases for “clean” BTC with no transaction history, and a potential government-led BTC auction could draw significant sovereign and institutional interest.
BlackRock Expands Bitcoin Access in Europe
BlackRock is set to launch a Bitcoin Exchange-Traded Product (ETP) in Europe, with marketing expected to begin this month. While a major step for institutional adoption, European regulators remain hesitant to extend the same support to Ethereum and other digital assets.
Market Outlook: Institutional Demand vs. Macro Uncertainty
Despite short-term volatility, institutional inflows and regulatory advancements continue to build a strong foundation for long-term crypto adoption.
Disclaimer:
The information provided in this newsletter is for informational purposes only and should not be considered financial, investment, or legal advice. Please consult with a qualified professional before making any investment or financial decisions. Past performance is not indicative of future results, and all investments carry risks, including the potential loss of principal.
