State of the Market

Talos State of the Market is a weekly view of market structure, venue activity, derivatives positioning and flows across the digital asset landscape.

Weekly Pulse

The US economy added 162K jobs in August, nearly three times the consensus, pushing September rate hike odds back above 60%. BTC pulled back in the immediate aftermath, absorbing six times its typical payrolls reaction, but has continued to consolidate near $77K-$80K. By midweek, Brent crude oil crossed $100 as the US-Iran conflict escalated, putting inflation back on the table. Treasury yields climbed to three-year highs after the tripling of bond buyback operations to $6B landed below what markets expected.

Within crypto, some assets ran on their own catalysts. Hyperliquid (HYPE) reached a new all time high, while Zcash (ZEC) extended its rally surging over 50% on the back of a strong debut for Grayscale's spot ETF. Robinhood expanded its prediction markets buildout, taking equity stakes in Crypto.com and its spinoff OG.com to route retail event contract volume through their CFTC-regulated infrastructure. 

Looking ahead, Friday's CPI data is the last major input before the September 15-16 FOMC, with the decision still finely balanced.

Market Performance

The total crypto market cap stands at $2.85T, rising 2.5% over the past week. Bitcoin rose 1.3% on the week, outperforming on a relative basis to S&P 500 (-1.3%), Nasdaq 100 (-0.1%), and Gold (-1.8%) as risk assets broadly retreated on shifting rate hike expectations. 

• Crypto Majors: BTC: +1.3% | ETH: +3.3% | SOL: +1.5%
• Top Gainer: Zcash (ZEC) up 52.7% on the back of strong inflows for the Grayscale spot ETF 

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Flows

• Spot Bitcoin ETFs pulled in $742M over the past week, more than triple the prior week and bringing the 30-day total to $2.73B.
• Exchange balances continued to draw down, with $1.17B of BTC and $302M of ETH flowing out of exchanges on net over the week, extending a 30-day outflow of $4.4B in BTC. 
• Stablecoin supply grew by ~$713M, driven by Circle’s USDC and Ethena's USDe, suggesting liquidity entering the onchain ecosystem. 

Spot & Derivatives Activity

• Spot volume across exchanges rose 6.8% WoW to $193B while futures volume slipped 2.2% to $1.01T. Open interest built through the week, with BTC up 2.4% to $45.1B and ETH up 4.7% to $26.3B, while funding rates eased to +5.6% annualized.
• XRP, DOGE and BNB are trading near 12-month highs for open interest relative to market cap, while positioning in BTC, ETH and SOL has been flat to lower over the same period. The buildup looks concentrated in a handful of names rather than broad-based.
• Oil perps saw the sharpest pickup in RWA markets, with volume up 36% WoW to $8.7B as Brent touched $100. Binance carried roughly 60% of the flow, with Trade.xyz's WTI and Brent markets on Hyperliquid accounting for another 28%.

In Focus

Perps Beyond Crypto

Perpetual futures now account for 84% of total derivatives volume. Perps on equities, commodities and indices were a rounding error on major digital asset exchanges in January. They now span gold, oil, equities and even pre-IPO markets on SpaceX and Anthropic across Binance, OKX, Bybit and Hyperliquid (through various HIP-3 builders).

Across tracked markets, RWA perp volume has grown from under $1B a day in January to $18.8B, now 18.5% of futures volume on these venues. Crypto perp volume declined over the same period, leaving total activity roughly flat. RWA markets have effectively filled the gap, giving venues a revenue base less tied to the crypto cycle.

RWA markets make up 28% of futures volume on Hyperliquid and 24.8% on Binance, with memory and semiconductor names like SanDisk and SK Hynix among the highest-volume RWA markets on Binance alongside gold.

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^{Disclaimer: Talos Global, Inc. and its affiliates ("Talos") is not an investment advisor or broker/dealer. This information does not constitute an offer to buy or sell, or a promotion or recommendation of, any digital asset, security, derivative, commodity, financial instrument or product or trading strategy. This information is not intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. This information is subject to change without notice. It is provided only for general informational, illustrative, and/or marketing purposes and is not intended for retail clients. The information provided was obtained from sources believed to be reliable at the time of preparation, however Talos makes no representation as to its accuracy, suitability, non-infringement of third-party rights, or otherwise. Talos disclaims all liability, expenses, or costs arising from or connected with the information provided. All content is provided for informational and illustrative purposes only. It does not represent firm offers, executable prices, or commitments of any kind, and should not be relied upon as indicative of current or future market prices or the terms on which any transaction may be executed.}

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