The momentum of funds is slowing down, mainstream tokens are adjusting and differentiating, and the market's consolidation at high levels is becoming evident.

Capital repair is restricted, mainstream tokens are fluctuating and adjusting, altcoins are retreating, and the market is consolidating at high levels

Geopolitical tensions are escalating, causing fluctuations in market sentiment. The conflict between Israel and Iran has triggered a brief risk-off sentiment, leading to decreased volatility and increased expectations for a Federal Reserve rate cut, resulting in an overall cautious and wait-and-see atmosphere.

The momentum of funds is marginally recovering but lacks sustainability. ETFs have returned to net inflows, but the momentum has slowed down. The growth rate of stablecoin issuance is declining, and the premium of USDT has weakened, indicating a cautious attitude towards fund entry.

The trends of mainstream tokens are diverging, with Bitcoin's strength slowing down and Ethereum adjusting again after a rebound. Bitcoin faced resistance and pulled back after a surge, while Ethereum's rebound showed weakened momentum. Some institutions continue to increase their holdings, and the overall structure remains neutral to strong.

Altcoin liquidity marginally improved but failed to surge. The TOTAL2 index faced resistance and retraced again, while the market share of OTHERS stopped declining and fluctuated. The on-chain prosperity index is at 53, still not out of the weak channel.

The current market is at the end of consolidation, and short-term traders need to wait for capital breakthroughs to align, requiring patience to observe the strengthening of altcoin structures and signs of capital flowing back to mainstream tokens.

1. Macroeconomic and Market Environment

In terms of geopolitics, the conflict between Israel and Iran is limited to missile/drone exchanges, with a low risk of full-scale war, expected to last about two weeks. The United States is providing support but has not intervened directly.

In terms of market dynamics, oil prices have risen due to sentiment, Bitcoin has returned to $105,000, U.S. stocks have rebounded, volatility has decreased, and the market is stabilizing.

In terms of economic policy, the probability of a rate cut in July has increased. The Federal Reserve needs to balance inflation and the economy, while geopolitical conflicts may involve the US-Israel game.

2. Analysis of Capital Flow and Mainstream Token Market Structure

External Capital Flow:

• ETF funds inflowed $2.8 billion this week, a significant inflow
• The issuance of stablecoins increased by 2.3 billion this week, with an average daily issuance of 321 million, which is at a relatively high level.

Market Sentiment Indicator:

• The premium of stablecoins continues to rise.

Bitcoin(BTC):

• The technical aspect is in a fluctuating upward range.
• On-chain chip distribution shows that chips over $103,000 are enhanced.

Ethereum ( ETH ):

• The trend is weaker than BTC, ETH/BTC remains volatile, and funds continue to flow back to BTC.
• On-chain data shows an increase in active addresses, which may indicate the completion of a phase of bottoming out.

Macroeconomic Review

Geopolitical Conflict Focus:

• The terrain of Iran is mainly mountainous, surrounded by mountains, with a population and conventional weapons far exceeding those of Israel, making it difficult for Israel to initiate a ground war on its own.

• The conflict is expected to be limited to targeted eliminations ( such as missile and drone attacks ), lasting about two weeks and presenting a long-term low-intensity confrontation situation.

• In the current situation, the market has low concerns about a full-scale war, and geopolitical risks are more reflected in emotional fluctuations.

• The rise in oil prices is due to emotional reactions and has no direct impact on global oil supply in the short term.

• Although the pre-market for US stocks is negative, it is rebounding, with Bitcoin rising to $105,000, indicating an improvement in market sentiment.

• The volatility has retreated from the morning high, fluctuating within the $1000 range in the afternoon, with a reduced amplitude compared to macro events at the beginning of the year.

• The increase in institutional holdings has led to a decrease in circulating coins, improving market stability, but it is still driven by sentiment in the short term.

• The price trend of Bitcoin is increasingly correlated with the US stock market, and the long decision-making cycle of institutions has led to a decrease in circulating chips.

• Ethereum and Solana maintain a high volatility pace due to the lack of large ETFs and deep institutional participation.

Neutral interest rate expectations:

In the second half of 2025 to 2026, the market expects the Federal Reserve to gradually lower interest rates. The probability of a rate cut of 225-250 basis points at the December 10, 2025 meeting is 28.6%, while the probability of a reduction to 400-425 basis points is 21.3%. The extent of rate cuts in 2026 may stabilize, with a more dispersed probability distribution.

On-chain data analysis

1. Stablecoin capital flow: This week, the issuance of stablecoins increased by 1.149 billion, a week-on-week increase of 14%, with an average daily issuance of 164 million. The growth rate of issuance has slowed down, which is related to the price trend of BTC. The total amount of stablecoins continues to grow, but the pace of issuance is volatile, so it is advisable to remain cautiously optimistic.

2. ETF Capital Flow: This week, Bitcoin ETF net inflows reached $1.02 billion, an increase of $1.718 billion compared to the previous period, reflecting a short-term rise in institutional investment sentiment. The daily inflow rate first increased and then decreased, in sync with BTC price trends. ETH ETF also saw significant inflows.

3. Off-exchange premium: The off-market premium rates of USDT and USDC first rose and then fell, reflecting that funds initially flowed back in and then retreated. The USDC premium rate has returned to 100%, while USDT continues to dip to 99.65%. The overall premium rate still shows a downward trend, indicating a cautious market sentiment.

4. MicroStrategy Purchase: MicroStrategy has continued to increase its Bitcoin holdings this year, but the pace of purchases above $100,000 has slowed. The buying volume has slightly increased when prices have fallen, indicating caution at high levels but a willingness to accumulate during pullbacks.

5. Holdings of short-term and long-term holders: The supply of long-term holders continues to reach new highs, indicating increased confidence from long-term investors. The supply of short-term holders is fluctuating, and the pullback in the latter half of this week may be driven by short-term selling pressure, while long-term holders are still increasing their holdings.

6. Token Address Distribution: The proportion of addresses holding between 1K and 10K decreases, while addresses holding between 100 and 1K and between 10K and 100K continue to increase, with selling pressure gradually being absorbed.

7. URPD Analysis: The chip concentration area remains focused around 103000-106000, with little change this week.

Summary: The technical aspect is at a critical position, and a reversal in the capital flow next week may lead to a rebound; otherwise, it may break key support and form a double top. It is recommended to pay attention to changes in the capital flow to determine the market direction.