🏆 The crypto market is setting new records

The Bitcoin price has once again made the headlines in recent days: with a new record established at over $122k, the cryptocurrency sent a clear signal. Driven by billions in ETF inflows, an increasing supply shortage and an overall market-wide rally that has lifted the global crypto market to an unprecedented $3.8 trillion capitalization.

In the past twelve trading days alone, US spot Bitcoin ETFs have seen cumulative net inflows of $6.6 billion. Funds from BlackRock, Fidelity and other providers now weight over $152 billion in Bitcoin's market capitalization, a share of 6.5%.

On July 10 and 11, over $1 billion flowed into this form of investment for the first time on two consecutive days, impressively underlining the growing confidence of institutional investors.

At the same time, analysts are observing increasingly aggressive accumulation by private investors. The so-called shrimp, crab and fish cohorts (people owning less than 100 BTC) are currently stacking at a monthly rate of 19,300 BTC, significantly more than the issuance rate of 13,400 BTC since the last halving.

Demand from small investors is therefore already absorbing the entire mining output, regardless of the price level. Experts from Bitfinex speak of price-agnostic behavior and sustained bullish momentum, which is also reflected in a Fear & Greed Index of 74.

These developments are also reflected in the market as a whole: the capitalization of all cryptocurrencies reached a new all-time high of $3.8 trillion, just behind the GDP of the United Kingdom.

Bitcoin's market value alone is now over $2.4 trillion, surpassing the valuations of Amazon, Google and silver.

This new record for the crypto market capitalization broke through an important resistance level that was at $3.7 trillion. Analysts interpret this as a signal for a likely continuation of an upward momentum.

Historical chart patterns suggest a medium-term target of up to $4.45 trillion, an increase of 19% from the current level.

The current market phase illustrates a structural shift: institutional funds are increasingly dominating the market, while retail investors are positioning themselves for the long term. The result is a historically tight market with declining liquidity on the supply side, a breeding ground for volatile price movements but also evidence of Bitcoin's growing maturity as a macroeconomic asset.

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📈 USDT on the rise

Tether's stablecoin USDT has reached a new milestone: with a market capitalization of over $160 billion, it has cemented its role as the dominant digital dollar:

According to its CEO Paolo Ardoino, the USDT has long since become a stable store of value and daily means of payment for over 400 million people in emerging and developing countries, with a quarterly growth of around 35 million new wallets. In regions with unstable fiat currencies, the USDT fills a structural gap in payment transactions.

Tether is also broadly distributed across multiple blockchains, with Tron as the leading platform with 81 billion USDT, followed by Ethereum with 65 billion:

Other networks such as BNB Chain, Solana and Polygon play a smaller role with a combined total of around 10 billion USDT. The coverage of the token is conservative: according to Tether, 81.5% of its reserves consist of cash and short-term US government bonds, with Bitcoin accounting for around 5%:

This makes Tether one of the largest government bond holders in the world, on a par with countries like South Korea or Germany.

The issue volume is also high: over 4 billion new USDT were minted last week. At the same time, the company is realigning its strategy and will cease redemption on five legacy blockchains from September in order to focus on scalable networks with active developer communities:

Parallel to economic expansion, USDT is also gaining importance in everyday life. According to a recent Bitget study, 36% of Gen Z already use cryptocurrencies for daily expenses such as gaming, travel or online shopping:

In Latin America, Southeast Asia and the Middle East, the number of merchants accepting stablecoins as a means of payment is also increasing:

On the political side, the topic is creating a lot of discussion. Although the Trump administration supports stablecoins and is pushing for regulatory clarity with the bipartisan GENIUS Act, critics warn that the new law would force stablecoins into a government-monitored corset that is hardly distinguishable from a CBDC in functional terms.

Representatives such as Marjorie Taylor Greene and Saifedean Ammous see this as an attack on financial freedom:

Nevertheless, USDT remains the leading force in the stablecoin sector, and thus a strategic building block of the future financial infrastructure.

Tether embodies the contradictions of the crypto sector: on the one hand, there is the decentralized but efficient corporate structure with billions in reserves, on the other hand there is the broad acceptance by users in poorly served regions. The political debate about control versus freedom is probably just getting started.

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💎 Ethereum renaissance

Ethereum is currently experiencing a remarkable strategic revival, both financially and technologically. Following the approval of the US Ether ETFs, over $727 million flowed into those funds on July 17 alone, led by BlackRock and Fidelity.

In total, US ETFs now hold over 5 million ETH, more than 4% of the circulating supply. In parallel, the "trustware" narrative is gaining traction, with Consensys and Fidelity portraying Ethereum as the backbone of a new global trust system that combines digital assets, stable currencies and real-world assets.

Ethereum is thus becoming the infrastructure for digital finance. According to Electric Capital, over 54% of all stablecoin transactions take place on Ethereum. The platform fulfills institutional requirements such as global accessibility, political neutrality and regulatory security.

In addition, ETH is increasingly acting as a reserve asset: it is not only scarce and stable, but also secures over $19 billion in on-chain loans. Fidelity's model sees Ethereum as a sovereign economy with ETH as the base currency, a view that attracts institutional investors and is supported by metrics such as over 2.5 million active wallets daily.

Ethereum is also facing a technological upheaval. The Ethereum Foundation has announced that it will replace the entire block execution with zero-knowledge proofs within a year, a turning point that is intended to combine scalability and security.

Vitalik Buterin also recommends a minimalist layer 2 approach: L2s should focus on the essentials - sequencing and validation - in order to achieve maximum efficiency and minimize trust. The message is clear: instead of competing with Ethereum, it is more strategic to build on it.

Ethereum is currently benefiting from three growth drivers: institutional capital, technological clarity and a new conceptual positioning as a global trust infrastructure. While Bitcoin is established as digital gold, ETH is positioning itself as the backbone of on-chain finance.

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⚖️ Regulatory strategy: Europe vs USA

While Europe has created a uniform regulatory framework for crypto-assets with the MiCA regulation, the US government is pursuing an opposing strategy: deregulation and institutional openness. At the same time, other countries are focusing on local advantages with targeted tax breaks. This is creating a global stress test for the future of crypto regulation.

MiCA has been in force for around 200 days. Although it was initially met with skepticism, it is developing into an advantage: more and more large exchanges like Coinbase, OKX and Bybit are applying for MiCA licenses in order to be able to offer regulated services to European customers.

For users, it is supposed to mean more consumer protection and more transparent processes. At the same time, the regulatory burden is increasing, which can squeeze out smaller players. However, the clear legal situation also creates new opportunities, for example in the area of regulated stablecoins and institutional investments.

Despite progress, structural risks remain. In a recent report, the EU securities regulator ESMA warns against Maximum Extractable Value (MEV). This refers to profits that actors generate through the targeted rearrangement or insertion of transactions on the blockchain. Ethereum is particularly affected, where over $1 billion have already been earned that way since the switch to a proof-of-stake system.

The practice leads to unfair trading conditions, can undermine trust in DeFi protocols and, in the long term, lead to a concentration of power among a few players. MiCA does not yet explicitly regulate MEV, but the topic is increasingly becoming the focus of regulatory authorities.

In the USA, meanwhile, the opposite course could become established under Trump. According to a report in the Financial Times, the government is preparing a decree that would allow investments in cryptocurrencies within state-sponsored 401(k) pension plans.

This would mark a significant change of course after restrictions on such investments were in place under the previous government. The 401(k) market has a volume of almost $9 trillion, a pool of capital that could suddenly enter the crypto market. Trump stated via his spokesperson that official decisions are only announced by the president, but the political thrust is clear: crypto is to be established as a strategic asset.

At the same time, the issue of tax exemption is increasingly becoming the focus of global competition. Some countries are focusing on targeted relief measures to attract crypto companies and wealthy investors:

The Cayman Islands, the United Arab Emirates and El Salvador completely waive taxes on crypto transactions. Germany grants tax exemption after a holding period of twelve months, while Portugal also remains attractive for long-term investors. These policies could lead to a geopolitical redistribution of capital and talent.

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🤔 Bitcoin and the custody paradox

Institutional Bitcoin purchases continue to gain momentum: Strategy, the publicly traded company led by Michael Saylor, acquired 4,225 BTC last week for approximately $472 million. This brings the firm's total holdings to over 600,000 BTC, purchased at an average price of $71,268 per coin. In 2025 alone, Strategy has added 88,062 BTC worth $10.9 billion to its portfolio.

Canadian firm Matador Technologies aims to build a reserve of 6,000 BTC by 2027. Through a preliminary shelf prospectus, the company plans to raise up to 900 million CAD to finance Bitcoin investments. The company's strategy is a “Bitcoin flywheel” model, where Bitcoin holdings generate revenue reinvested into further acquisitions.

At the same time, the ongoing ETF boom raises structural concerns: Since the launch of spot Bitcoin ETFs in January 2024, the number of active Bitcoin wallets has declined significantly. Investors are increasingly turning to regulated products with institutional custody, an evolution that runs in the opposite direction of Bitcoin's original self-custody ethos.

BlackRock's IBIT leads the field with over 700,000 BTC and $83 billion in assets under management, while treasury firms like Strategy and Tesla have also become dominant forces in Bitcoin asset allocation.

The institutional surge is increasingly undermining a core tenet of Bitcoin's original vision: financial self-sovereignty. While ETFs and treasury firms offer regulatory clarity and convenience, they also promote dependency, centralization, and delegated trust, precisely what Bitcoin was designed to eliminate.

The sharp decline in active wallets is a warning sign. Digital sovereignty is quietly giving way to passive subjugation. If this trend continues, Bitcoin risks losing its role as censorship-resistant money, not through government bans, but through the comfort of self-abandonment.

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