Macroeconomic pressures and weak capital have combined, leading the crypto market into a defensive consolidation phase.

Recently, the crypto market has shown a volatile trend, with mainstream coins performing well under pressure but losing momentum, while small-cap coins are clearly retreating, and the market as a whole has entered a defensive consolidation phase.

Macroeconomic Environment and Market Sentiment

The uncertainty at the macro level has increased, suppressing market risk appetite. The expectation of a delayed rate cut by the Federal Reserve, along with rising tariff and geopolitical risks, has put pressure on the market. In terms of liquidity, although there are signs of marginal improvement, structural differentiation is evident. After a large inflow into crypto ETFs at the beginning of this month, there has been a shift to net outflows, the issuance of stablecoins has been moderate, and the premium for OTC USDT has fallen below 100%, reflecting a cautious attitude among investors.

Performance of Mainstream Coins in the Crypto Market

Bitcoin remains relatively strong but its upward momentum is weakening, while Ethereum shows signs of weakness and consolidation, with the ETH/BTC ratio declining. The liquidity in the small-cap token market has dried up, and risks continue to be released, with TOTAL2 and TVL declining in tandem. The market share of OTHERS has broken downwards, indicating that the market is in a stage of risk release.

Fund Flow Analysis

In terms of external capital flow, the crypto ETF experienced a net outflow this week, while the issuance of stablecoins remained at a moderate level. On-site sentiment indicators show that the stablecoin premium has rebounded somewhat but is still at a low level. On-chain data indicates that the Bitcoin chips above $103,000 have strengthened, and the number of active Ethereum addresses has increased, which may suggest that the phase of bottom formation is complete.

Macro Economic Review

1. U.S. Debt Issue: The debt scale has reached $36 trillion, with interest expenses as high as $880 billion, and an additional $3 trillion deficit may be added over the next 10 years. Moody's downgrade of the U.S. credit rating has raised market concerns, which may drive investors towards safe-haven assets such as Bitcoin.

2. Federal Reserve Monetary Policy: The market expects an increased probability of interest rate cuts in the second half of 2025. If the interest rate is cut by 1%, the United States could save over $100 billion in interest expenses. The enhanced expectations of interest rate cuts are favorable for risk assets like Bitcoin.

3. Dollar Trend: The US dollar weakened in May, but it is expected to stabilize in the second half of the year. The dollar has a negative correlation with Bitcoin; a weaker dollar is generally good for Bitcoin in the long term, but if the dollar stabilizes, Bitcoin may face pressure in the short term.

Market Outlook

Given the current market environment, it is recommended to maintain a defensive position allocation. Pay attention to whether Ethereum shows signs of strength or weakness, as well as the rhythm of capital inflow, before considering the layout of high-risk assets. In the short term, be cautious of the potential for Bitcoin to experience a pullback due to macroeconomic factors.

In the coming week, it is important to closely monitor the release of economic indicators such as the U.S. CPI data and retail sales data, as well as significant events like the Federal Reserve's interest rate decision, to assess their potential impact on the crypto market.