Crypto Week Sparks Divergence

Daily Updates:

• Yesterday, while most of the crypto market was up, BTC was trading lower at $117K.  
• In fact, at the beginning of last week it was BTC that surged to a new all-time high on the back of the so-called “Crypto Week”. However, by the end of the week, following the signing of the GENIUS Act on the evening of July 18, BTC has moved steadily from $120K to $117K – while altcoins such as Ether surged higher. Last Friday, ETH was trading closer to $3,500 – it then surged to $3,850 before selling off slightly and now trading at $3,600. 
• The passing of legislations in Washington that are designed to further assimilate cryptocurrencies into traditional finance has rekindled risk-appetite in altcoins, while currently marking a pause in BTC’s rally.
• That divergence is being reflected in Bitcoin dominance. We have commented in previous reports that based on historical precedence, a decline in BTC dominance is long overdue – indeed what we find is BTC dominance has dropped from 64% at the start of the month to 59%. 
• Additionally, yesterday Spot BTC ETFs saw net outflows of $131.4M — the first day of outflows since July 1, 2025.   

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• Ethereum spot ETFs continue their strong momentum, adding $296.5M in purchases yesterday alone.
• This follows a record-breaking week with $2.18B in net inflows — equivalent to 677,000 ETH —bringing ETF holdings to a record 5.15M ETH.
• Trading volume hit $10.5B, with BlackRock’s iShares Ethereum Trust ETF (ETHA) dominating both inflows (over 80%) and volume (nearly 70%). The AUM of spot Ethereum ETFs also reached a new all-time high of over $15.5B.
• SharpLink Gaming (NASDAQ: SBET) is leading the corporate adoption, now holding ~280,706 ETH — worth around $840M.

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• In derivatives markets, implied volatility for both BTC and ETH options have dropped over the past 24 hours for tenors less than 30 days, while the volatility on longer-dated options has increased slightly. 
• 7-day BTC options once more trade with an at-the-money implied volatility of 30%, while similar-dated ETH options trade with an IV just short of 70%. 
• Short-tenor BTC options are now also skewed towards OTM puts while in perpetual swap markets, funding rates trade close to neutral.

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• Solana surged 12.26% in the last 24 hours, breaking above the $204 threshold for the first time since February 2025. Trading now at $198, the Layer 1 powerhouse is signalling a sharp return of investor confidence and liquidity to the ecosystem.

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• On Wall Street, the S&P 500 closed at 6,305.60 – the first time the index has closed above 6,300 in its history. However, the index gave back most of its gains in yesterday’s trading having touched a higher 6,335.54 intraday before selling off. 
• US treasuries rallied, led by moves in longer maturities as the 30-year yield dropped 4bps to 4.95%.

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• Michael Saylor’s Strategy acquired 6,220 bitcoins for $749.8M, bringing the business-intelligence turned Bitcoin treasury firm’s total holdings equivalent to 2.89% of the total 21M Bitcoin supply. 

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• President Trump’s Trump Media & Technology Group Corp., the company behind Truth Social, announced a $2B acquisition of Bitcoin as part of its previously announced plan to become a crypto treasury company. In its press release, the company stated that it will use its Bitcoin securities “to generate revenues and potentially to acquire additional crypto assets.”

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• The Ether Machine, a newly formed entity, announced its public launch through a merger between The Ether Reserve and blank check company Dynamix Corporation. It will trade on the Nasdaq under the ticker symbol "ETHM" upon deal close, which is expected to be in Q4 2025. The company is aiming to launch with more than 400,000 Ether on its balance sheet. According to its website: “Through staking, restaking, and participation in the broader Ethereum ecosystem, we aim to not only generate long-term ETH-denominated returns, but also deepen the network’s utility, security, and global adoption.”

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• Blank check firm TLGY Acquisition Corp. is merging with StableCoinX Assets Inc. to form StablecoinX Inc., a treasury company that will be focused on buying and holding ENA tokens. ENA is the governance token of Ethena which runs its own dollar-based stablecoin, USDe. 

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• JPMorgan Chase is considering offering loans secured by clients’ cryptocurrencies, including Bitcoin and Ether, potentially launching as early as next year, per the Financial Times announcement
• The bank is advancing crypto services—already planning loans against crypto ETFs—reflecting a growing institutional embrace of digital assets.
• This move aligns with recent US regulatory momentum — notably the GENIUS Act, which establishes a federal framework for stablecoins and supports broader crypto adoption — a topic we recently covered in our report with Bybit.

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• Volcon, Inc. (NASDAQ: VLCN) has raised over $500 million and plans to invest over 95% of the proceeds into BTC, extending their current holding of 280.14 BTC.
• This comes alongside an imminent rebranding to Empery Digital, Inc., with a new ticker symbol EMPD.

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• DeFi Development Corp. (Nasdaq: DFDV) have bought 141,383 SOL at an average price of $133.53 (totalling around $19M) between July 14 and July 20, which brings their total holding to 999,999 SOL and SOL equivalents.

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• Polymarket announced the $112M acquisition of QCEX, a US-licensed derivatives exchange and clearinghouse regulated by the CFTC. This strategic move paves the way for Polymarket’s return to the United States after a more than two-year pause.
• QCEX, headquartered in Boca Raton, Florida, provides the regulatory framework enabling Polymarket to operate as a fully compliant platform. Polymarket’s decentralized prediction market recorded over $15B in trading volume last year.

This Week’s Calendar:

Charts of the Day:

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Figure 1. BTC at-the-money implied volatility across selected tenors. Source: Deribit, Block Scholes

Figure 2. ETH at-the-money implied volatility across selected tenors. Source: Deribit, Block Scholes

Figure 3. BTC 25-delta put-call skew ratio across selected tenors. Source: Deribit, Block Scholes

Figure 4. ETH 25-delta put-call skew ratio across selected tenors. Source: Deribit, Block Scholes

Figure 5. BTC Dominance before and after each halving, excluding 2012. Sources: Coin Gecko, Block Scholes