US Futures and Crypto Rebound as Fed Rate-Hike Bets Recede

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In Today's Note

• US equity futures point higher after the Independence Day break, S&P 500 +0.44%, Nasdaq-100 +0.91%, as markets digest last week's weak NFP (57K vs 115K expected) and Warsh's comments that inflation risks have come down, BTC rallied above $63K over the weekend while ETH broke $1,780.
• Vitalik Buterin outlined Ethereum's 3-4 year 'Extremely Lean Chain' overhaul comparable in scale to the Merge, while Aave's newly launched Monad market topped $100M in deposits within two days and Ripple received preliminary MiCA authorization from Luxembourg.

Market Snapshot: Overnight Moves

Macro & Markets

• Following the closure of US equity markets last Friday for the Independence Day holiday, futures markets show signs of positive sentiment for the beginning of the week.
• Contracts on the S&P 500 and Nasdaq-100 are up 0.44% and 0.91% respectively, while BTC staged a recovery rally over the weekend, briefly breaking above $63K.
• The improvement in risk-on sentiment follows last Thursday’s weaker-than-expected nonfarm payrolls report as well as new Chair Kevin Warsh’s comments earlier in the week that “inflation risks have come down”.
• That caused markets to price out some of their hawkish expectations for Fed policy over the course of the year.

• An improvement in sentiment was also seen in spot Bitcoin ETFs, which, after ten consecutive days of outflows, saw a net purchase of $223.5M worth of bitcoin last Thursday.
• Since late June, BTC and ETH options markets have reduced much of the bearish premia they had assigned to out-the-money put options. 7-day 25-delta put-call skew for BTC has risen from -17% to -3% briefly over the weekend.
• That recovery in sentiment has been even more apparent in ETH options, where short-dated skew very briefly jumped above 0%, assigning a modest premium to OTM calls.

• Base and precious metals have benefitted from the receding expectations of an imminent rate hike from the Fed.
• Copper prices rose for a third day today while aluminum rose 0.5%, rebounding from a four-month low.
• Gold is currently trading just below $4,150 per ounce, up more than 3.5% over the past five days.
• The rebound in precious metals, which tend to outperform when interest rates are lower, has also been supported by a return in oil prices to pre-war levels which has helped reduce inflation expectations, as well as a pickup in energy flows through the Strait of Hormuz.
• According to Bloomberg data, Saudi Arabia, one of the largest exporters of crude oil, shipped 6.3M barrels a day in the six days through Wednesday last week. That put flows at roughly their 2025 average and nearly 90% of levels in February, just before the US-Iran conflict began.

• New York Fed President John Williams said last Thursday that he expects inflation to come down over the coming quarters and as such, "the current stance of monetary policy is well positioned" to bring inflation back to the Fed’s 2% target.
• The NY Fed President did warn however that risks do remain, "The AI investment boom may push up prices more than expected … and the global supply disruptions stemming from the conflict in the Middle East remain a source of risk to both the growth and inflation outlooks.”

• In geopolitics, according to Fortune News, the Trump administration is looking to use frozen Iranian assets to help US allies in the Persian Gulf to rebuild from inflicted damage stemming from the US’s conflict with Iran.
• According to a senior administration official, negotiations between both sides have been affected by diverging views on the $24B in frozen Iranian financial assets.
• Treasury Secretary Scott Bessent has directed the US Treasury to come up with comprehensive estimates of the costs involved in repairing damage.
• Separately, President Trump will head to Turkey on Tuesday for the NATO summit where is expected to discuss both Middle East tensions and potential peace talks between Russia and Ukraine.

DeFi / Web3 / Altcoins / Crypto

• Vitalik Buterin, Ethereum’s co-founder, said the network’s planned Ethereum “The Extremely Lean Chain” overhaul will take three to four years and become Ethereum’s “third major iteration,” comparable in scale to the Merge.
• The roadmap would replace almost every major part of Ethereum’s protocol, including how transactions are validated, how the network stores data, how quickly transactions become final and how Ethereum prepares for quantum-safe cryptography.
• Buterin said the storage redesign plan can potentially cut fees for some token transactions by more than 10x, while Hegota, Ethereum’s upcoming second upgrade in 2026, will likely be the network’s last major “pre-Lean” hard fork.

• Open Standard, the consortium behind the proposed dollar-backed OUSD stablecoin, announced earlier this week that OUSD would launch within the year with more than 140 listed participants, but several Korean firms said they had only been asked to review possible participation and were surprised to see their names included.
• In particular it was reported that Samsung Electronics, a South Korean electronics and technology conglomerate, and Dunamu, the South Korean operator of crypto exchange Upbit, said they were listed as members of Open Standard’s OUSD stablecoin consortium without formal agreement or official consultation.

• Aave, the largest decentralized lending protocol, saw deposits on its newly launched Monad market, its separate lending-and-borrowing pool on the Monad blockchain, top $100M about two days after deploying Aave V3 on the network.
• Monad, a high-throughput EVM-compatible Layer 1, launched the Aave market with 12 supported assets, while Monad Foundation, the organization behind the network, committed $15M in first-year incentives and agreed to acquire and hold 10M GHO, Aave’s native decentralized stablecoin.

• Ripple, a crypto payments company, received preliminary MiCA Crypto-Asset Service Provider authorization from Luxembourg’s CSSF, the country’s financial regulator, allowing it to offer crypto-asset services across 30 European Economic Area markets once final conditions are met.
• The authorization builds on Ripple’s existing Electronic Money Institution license in Luxembourg, giving the company a combined regulatory framework for stablecoin issuance, electronic money services and crypto payments across Europe.

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