Markets Pull Back, Ethereum Goes DeFipunk, Circle’s Upsized IPO

• BTC ETFs shed $768.3M, while ETH ETFs attracted $406.8M
• Circle raised $1.1B in an upsized IPO
• Robinhood completed its acquisition of Bitstamp
  
  

Crypto rally takes a breather, ETF flows mixed, Ethereum goes DeFipunk

Crypto markets pulled back this week, with total market capitalization just shy of the $3.3 trillion mark and bitcoin dominance holding above 63%. Among the majors, bitcoin declined 3.9% week over week, while ether slipped 2%. Flows told a more nuanced story—BTC spot ETFs saw $768.3 million in cumulative net outflows, while ETH spot ETFs bucked the trend with $406.8 million in inflows over the same 5-day period. Notably, BTC ETFs turned positive over the last 2 trading sessions after 3 straight days of redemptions, while ETH ETFs extended their inflow streak to 13 consecutive days. Combined flows across all US-listed crypto spot ETFs topped $600 million over those final 2 sessions. Beyond flows, the ETF ecosystem is expanding in utility: Bloomberg reported that JPMorgan plans to let select trading and wealth clients use crypto-linked assets—starting with IBIT shares as collateral for loans. In a further step, some clients may soon see crypto exposure counted toward net worth and liquidity, bringing it closer to parity with traditional securities.

The SEC this week invited public comment on a proposed rule change that would allow the WisdomTree Bitcoin Fund to enable in-kind creations and redemptions—marking the latest chapter in ongoing deliberations around ETF mechanics. Similar feedback rounds have previously been requested for in-kind structures tied to BlackRock’s IBIT and VanEck’s Bitcoin and Ethereum Trusts, as regulators weigh how best to balance liquidity, investor access, and market stability in crypto fund design. Meanwhile, a fresh entrant joined the ETF race: NYSE Arca filed a 19b-4 with the SEC on behalf of Yorkville America Digital to list a bitcoin fund backed by Truth Social, the media company owned by Donald Trump. The product would track the price of bitcoin and, if approved, appoint Foris DAX Trust Company—also custodian to Crypto.com. An S-1 registration is still pending, but the filing adds to Trump’s growing crypto portfolio, which already includes the World Liberty Financial stablecoin venture and meme tokens like Trump Coin and Melania Coin launched prior to his 2025 inauguration.

Elsewhere in crypto governance, the Ethereum Foundation is taking a more deliberate approach to financial planning as it braces for a critical stretch ahead. The Ethereum Foundation (EF) is rolling out a more structured and transparent treasury strategy, aiming to better align operational spending with its ether reserves as it prepares for a pivotal 18 months ahead. Speaking on June 4, EF director Hsiao-Wei Wang noted the foundation has just 2.5 years of runway left, prompting a deliberate shift toward reassessing costs, runway, and asset deployment based on market conditions and community input. The move follows community criticism over unannounced ETH sales, which had raised concerns around trust and transparency. To address this, the EF will now publish quarterly and annual reports detailing asset holdings, performance, and major developments. As of Oct. 31, EF’s treasury stood at $970.2 million—81% of which was in ETH. The EF also plans to generate “acceptable returns” by allocating capital to immutable, well-audited DeFi protocols, reinforcing both its balance sheet and its commitment to what it calls “DeFipunk principles.” In February, it earmarked 45,000 ETH (then worth $120 million) for DeFi deployment, already supplying assets to Aave, Spark, and Compound, and borrowing $2 million worth of GHO from Aave. On the organizational side, the foundation recently restructured its internal development team as of June 2, resulting in some staff reductions, though no specifics were disclose.

Circle’s raises big, Robinhood’s global grab, Congress’s stablecoin tug-of-war

As consolidation and capital raising reshape crypto’s institutional landscape, two major moves made waves this week. Robinhood has closed its $200 million acquisition of Bitstamp, the world’s longest-operating crypto exchange, first announced last June. With over 50 licenses and registrations globally, Bitstamp provides Robinhood a direct path into both retail and institutional crypto markets across international jurisdictions. Meanwhile, Circle Internet Group—the issuer behind USDC—closed an upsized IPO, raising approximately $1.1 billion after selling 34 million shares at $31 a piece, according to Bloomberg. The raise gives Circle a potential market value of $6.9 billion and a fully diluted valuation of $8.1 billion. Just days earlier, the firm had targeted a more modest raise of $896 million. The IPO comes as stablecoin adoption gains momentum, with total circulating supply approaching the $250 billion mark. On the policy front, US lawmakers are pressing ahead with the GENIUS Act—a bill aimed at revamping stablecoin regulation—which has now advanced to the Senate.

The US Senate may be nearing a final vote on its stablecoin legislation—potentially a landmark moment for crypto regulation—but key differences remain between the Senate bill and a parallel effort in the House. Representative French Hill, who chairs the House Financial Services Committee, said at an Atlantic Council event Tuesday that while the two versions are "substantially similar," some differences must still be "rectified and clarified." A major sticking point is the House bill's stricter stance on international reciprocity, requiring foreign stablecoin issuers trading in the US to either register domestically or operate under a regulatory regime deemed substantially similar by US authorities. Hill added that the House version also offers a more "cleaner" delineation of regulatory oversight between state and federal agencies, depending on an issuer’s business model.

Another divergence lies in the treatment of non-financial firms issuing stablecoins—a flashpoint for Democrats wary of tech companies encroaching on financial infrastructure. The House bill permits such issuers under OCC supervision, while the Senate version includes language barring certain public companies from launching tokens. Hill noted the Senate's bill is still undergoing changes, making final comparisons premature. He questioned the narrative that stablecoin legislation should be easier to pass than broader crypto market reform, pointing out that the House has already advanced a more comprehensive crypto bill while stalling on stablecoins. Still, he acknowledged the Senate’s recent progress on the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act as a positive step and expressed optimism that the House can deliver. With President Trump pushing to see both bills on his desk by August recess, Hill said the House is well-positioned to make that happen—provided both chambers can ultimately agree on a unified version.

Crypto traded in the red this week, as profit-taking followed bitcoin’s recent all-time high—compounded by macro headwinds and the familiar seasonality of “sell in May and go away.” But stepping back, each crypto cycle has historically run longer and rallied higher than many expected. This one is no different in momentum, but it’s the first to be defined by real infrastructure: ETFs, stablecoins, and a visible path to broader adoption. Still, macro forces remain a key variable shaping the road ahead.

Macro pulse 

Among TradFi assets, US equities rose 1.4% on the week, while oil futures edged up 0.6%. Softer ADP employment and ISM Services PMI data fueled a bid for Treasuries, sending yields lower and pressuring the dollar. Safe havens—including JPY, CHF, and gold—caught a bid amid growing concerns over the US economic outlook. Meanwhile, the CBO revised down the projected deficit impact of Trump’s “big, beautiful” bill, easing fiscal concerns and further supporting bond markets. The US Dollar Index slipped 1.1%, 10-year Treasury yields fell 12 bps, and the Gold & Silver Index jumped 6.4% on the week.

^{*Note: Weekly (7 calendar day) performance figures are as of 8am SGT on June 05, 2025} 

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