Bitcoin broke its May high this week, reaching approximately $86,000 as it continued recovery from summer lows near $58,000. The move marked bitcoin's first close above its 50-week moving average in 45 weeks, signaling continued strength after the bear market.
U.S. equities traded in a tight range during the week. Bitcoin ETF flows remained positive, and a mid-week correction flushed open interest without significant price damage, removing what analysts characterized as unhealthy leverage.
Macroeconomic Backdrop
Long-term Treasury yields continued rising, prompting debate over their implications. Some market observers argued rising yields reflect expectations of economic growth and higher equity returns. Others warned that the yield increase signals concerning financial stress.
The National Financial Conditions Index indicates financial conditions remain as loose as they have been since the Federal Reserve began hiking rates in 2022. Despite higher yields, the U.S. dollar defied expectations of weakness.
Europe presented a different picture. France's credit rating faced a downgrade, with widening spreads between French and German government bonds drawing attention from market analysts.
Crypto Developments
In decentralized finance, Hyperliquid surpassed Solana in USDC balances. Token Terminal data showed significant week-on-week volume increases in tokenized stocks across multiple platforms, with Backpack-issued stock tokens seeing $193.3 million in additional trading volume.
Solana's trading volume in tokenized assets exceeded Robinhood Chain's spot DEX volume by week's end, with Solana attracting increased attention in the tokenized-asset space. The European Central Bank announced plans to introduce a digital euro for banks, though no consumer offering was announced.
Business Partnerships and Adoption
Chainlink announced a partnership with Infosys, a $40 billion global IT infrastructure provider. Apple and Google both advertised senior positions in blockchain and stablecoin roles, and major financial firms continued publishing research on cryptocurrency topics.
Security and Fraud Concerns
Bitget, a major cryptocurrency exchange, confirmed a hack resulting in approximately $351 million in losses. CEO Gracy Chen stated the exchange's protection fund covers the loss, though withdrawals were temporarily suspended.
Polymarket faced fraud allegations when the Wall Street Journal reported that bad actors used stolen debit cards to fund bets and attempted withdrawals to controlled accounts. The platform stated it maintains controls for suspicious activity and cooperates with authorities.
Prediction market platform Kalshi faced accusations of fabricated crypto activity and scrutiny over repeated trade sizes and statistical anomalies, though rebuttals disputed some claims.
A remote-code-execution vulnerability in iPhone Safari provided another reminder of browser security risks, with security experts emphasizing the importance of hardware wallets and caution when signing transactions online.
