ATH Surge Continues

Daily Updates:

• BTC flew past $118K this morning, marking a significant new all-time high and extending its record-breaking rally for a second consecutive day. 
• Demand from BTC Spot ETF products has also continued to surge – yesterday, Spot BTC ETFs saw $1.18B in inflows – their second largest single day of inflows since launch. 
• The second-largest cryptocurrency by market capitalization, Ether, has marginally outperformed BTC over the past 24 hours too. While the former is up 5.7% in the past 24 hours, ETH is up 6.5% and is now trading just shy of $3,000. 
• It too has been driven by significant and consistent inflows into its own US Spot ETFs. On Wednesday, ETH ETFs saw $211.3M worth of inflows which was only $4.4M less than inflows into the BTC ETFs. 
• Yesterday, ETH ETFs saw inflows amounting to $383.1M – also the second-highest daily total on record. 

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• Crypto’s breakout is also being fueled by continued validation on the regulatory front.
• The US House Committee on Financial Services recently announced that the week beginning July 14, would be declared as “Crypto Week”, and prior to that we saw the first US stablecoin legislation to pass through the Senate, the GENIUS Act on June 17, 2025. 

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• BTC’s rally now brings its year-to-date performance over 25% and since its April 9 post-reciprocal tariffs low, it is now up more than 50%. 
• All three directional measures of sentiment in derivatives markets are firmly in support of the rally. BTC perpetual futures contracts saw funding rates shoot up to 0.023% on an eight-hourly basis. While that has since dropped from its highs, positive funding rates indicate a willingness to stay in bullish positions and pay for leveraged upside exposure. 
• The futures-price implied premium above spot for 7-day tenors has more than tripled, from 4.68% earlier in the day yesterday, to 14.19%. Finally, volatility smiles across short and long-tenors are now firmly assigning volatility premiums up to 4.2% towards OTM call options. 
• At-the-money implied volatility for BTC options has increased in line with this rally. Over the past week, we’ve seen short-tenor volatility struggle to break below or above a range of 25%-35%. Currently, as spot price reached over $118K, the volatility premium on a 7-day BTC option rose to 38% – the highest in three weeks. 

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• ETH funding rates also surged to nearly match levels in BTC, climbing to highs of 0.02%. That marks a departure from some of the recent spot rallies in ETH that have failed to translate into a meaningful jump in funding rates. 

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• The past 24 hours have seen continued tariff threats from President Trump too. Speaking to NBC News, the President said he is considering a flat tariff rate of 15-20% on all trading partners, which would be an increase from the current 10% baseline universal tariff. 
• “We’re just going to say all of the remaining countries are going to pay, whether it’s 20% or 15%. We’ll work that out now,” Trump told NBC News in a phone call. 
• Justifying those higher tariff rates, he added “I think the tariffs have been very well-received … The stock market hit a new high today”. 
• He has also increased his levies on Canadian goods not covered by the USMCA trade agreement from 25% to 35%, which will take effect from August 1. 
• In a further bid to justify that markets have taken his tariff program positively, Trump posted on Truth Social: “Tech Stocks, Industrial Stocks, & NASDAQ, HIT ALL-TIME, RECORD HIGHS! CRYPTO, “Through the Roof”.

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• The growing disparity between Fed officials on the impact of tariffs on inflation that we recently covered was on display yesterday too. 
• St Louis Fed President Alberto Musalem said “It’s going to take time for the tariffs to settle”, and that “There’s a scenario where we could be in Q4 this year, or Q1 or Q2 of next year where tariffs are still working themselves into the economy”. 
• Musalem said so far the tariff impact is “mild”, but we “only have two months of price data after April, and the actual tariffs being paid at the border have only been increasing linearly towards the expected low teens, or somewhere between low teens and twenties, so it’s early to understand the full effects”. 

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• On the other hand, his San Francisco counterpart Mary Daly said “I see two cuts as a likely outcome but again there’s uncertainty bands around everyone’s projections”.
• Daly said some firms are negotiating to split up tariff costs so that they don’t have to pass along as much of the expense to their end customer.
• “By the time they get to consumers, they’re finding that the pass-through they do have to make is lower and some of it can be taken out of margins”. 
• “It’s possible it just doesn’t materialize to a large increase in price inflation for consumers because the businesses find ways to adjust”. 

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• The UK economy contracted by 0.1% in May, missing expectations for modest growth. It follows a 0.3% decline in April, marking two straight months of contraction.
• The downturn came despite a 90-day pause on US important tariffs introduced by Donald Trump in April.

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• Tokyo-based Gates Group – an integrated real estate firm – will tokenize $75M worth of income-generating Tokyo properties via Oasys blockchain.
• Gates plans to scale token liquidity to $34B and eventually bring over $200B of its holdings on-chain – roughly 1% or $20.5T of Japan’s property market.

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• The Ethereum Foundation is reorganising its Ecosystem Development (EcoDev) efforts to better support the global adoption and resilience of Ethereum. 
• New teams will be focused on accelerating adoption through support for developers, founders, applications, and enterprises, as well as amplifying ecosystem impact via events, media, and automation. 
• Long-term support includes grants, public goods funding, policy engagement, and academic collaboration.

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• Korean entertainment investment business, K Wave Media (NASDAQ:KWM) has secured a $500M convertible note deal with Anson Funds, with 80% of proceeds committed to Bitcoin purchases. The company has already acquired 88 BTC and aims to scale rapidly toward 10,000 BTC.

This Week’s Calendar:

Charts of the Day:

Figure 1. BTC futures-price implied premium above spot (annualised) at selected tenors. Source: Deribit, Block Scholes

Figure 2. BTC Perpetual swap contracts 8-hourly funding rates. Source: Deribit, Block Scholes

Figure 3. ETH Perpetual swap contracts 8-hourly funding rates. Source: Deribit, Block Scholes