Markets are on edge. The S&P 500 and Nasdaq just wiped out a year’s worth of gains, volatility is spiking, and BTC? Still up year over year — but just barely hanging on to long-term uptrend. From fading hopes of decoupling to trillion dollar XRP fantasies, we're living through strange times.

DEX volumes:

Here’s a crazy stat: Hyperliquid generated $13b in perps trading volumes yesterday. Based on DefiLlama’s estimates, the EVM-equivalent L1 has generated about $2.93m in fee revenues in the last 24 hours alone.

Fluid DEX, on the other hand, has seen $688m in volumes in the last 24 hours ($2.8b seven-day) — extraordinary numbers for a DEX that’s less than six months old and only exists on two chains (Ethereum and Arbitrum).

— Donovan Choy

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Hopes, safe havens and hallucinations

If I had a nickel for every time I’ve heard the adage about putting the toothpaste back in the tube applied to the Trump tariffs experiment, I could buy…oh, a small fraction of a bitcoin.

As much as we might wish the chaos to subside, the norms of mutually beneficial global trade may simply be over.

BTC is regarded as holding up relatively well, but as I see it, it’s more so hanging on by a thread. The kitten “hang in there” meme, if you will. Bitcoin yesterday narrowly avoided closing much below its March lows. (Technically it was lower, but within a fraction of a percent, depending on your source, including CME.)

So there’s hopium that the daily downtrend may yet reverse. Short term, with the VIX touching 60 yesterday — an extreme level rarely seen — you’d expect at least a reflexive bid. Both the Nasdaq and S&P 500 tagged their April 2024 lows by end of day Monday, essentially wiping out the past year’s gains. But BTC is still up 30% year over year.

Bitcoin’s decoupling narrative was short-lived. On a 30-day rolling basis, BTC’s correlation with the Nasdaq remains above 0.5 — historically high, as FalconX head of research David Lawant wrote in a note today.

Its momentum to the downside means bounces likely set up a lower high to fade. “The trend is your friend” and so on. Still, there has been less panic among bitcoin holders compared to both the August 2024 yen carry trade unwind and the 2020 Covid crash, when BTC fell noticeably harder than stock indices.

That doesn’t make BTC a safe haven, but it does say something. MEXC COO Tracy Jin attributes the relatively muted selling to institutional investor accumulation. “The asset is becoming an increasingly important part of a balanced portfolio,” Jin said, citing persistent inflation and recession fears as long-term tailwinds.

What else is avoiding meltdown?

“Pockets of strength are few and far between — TRX, OM and XRP are holding up relatively well while most large caps continue to lag,” wrote Wintermute trader Jake O. “This underperformance is fueling renewed BTC dominance, which has climbed back to around 65% — its highest level since March 2021.”

Speaking of XRP, in another sign of our bizarre times, Standard Chartered published an analysis suggesting it could have an FDV of $1 trillion by 2028. This notion is one I regard as beyond delusional. Ripple just ponied up $1.25 billion for a prime broker, Hidden Road, presumably in an effort to juice activity for its ledger. XRP is far and away the most expensive asset in crypto that virtually no one in crypto actually takes seriously.

“XRP is the social indicator in crypto, more so than even Doge,” mused Blockworks Research analyst David Rodriguez. “It’s a gateway drug for non-technical people.”

XRP’s run up in the past year is one of the more baffling phenomena we’ve witnessed, a testament to the cult mindset of its retail holder base, corralled by TikTok and YouTube influencers.

The ultimate irony would be if crypto’s version of a GME memestock could parlay its market cap into acquiring actually useful businesses to such an extent that it actually becomes relevant.

— Macauley Peterson

What is Etherealize?

What are Etherealize's goals?

Vivek Raman: For Ethereum to onboard the world’s markets, it takes more than education and building the best tech. It also requires ensuring that laws are going to be in favor of open, neutral [and] decentralized systems and making sure the learnings on the public policy frontlines are feeding back into Ethereum’s R&D. The largest roadblock for institutions was regulatory, which is starting to clear. What Etherealize needs to do is handhold these institutions and show them that Ethereum is open for business for anything they want to do…from asset tokenization, app or L2 deployment, etc. If Etherealize is successful, institutions are not just tokenizing assets on Ethereum, but engaging in the synergistic things that blockchain can offer them like permissionless borrowing, lending, trading and structuring products. That is the endgame.

Who is Etherealize targeting? 

Vivek Raman: Wall Street is the starting target audience (though it’s not the only target). Etherealize’s targets are sell-side banks [which] have been experimenting with blockchain adoption and buy-side asset managers who want to tokenize them on a public blockchain, and all the mid-sized brokerages and market funds in between. Etherealize is a full-on business development blitz.

What is Etherealize’s relationship with the Ethereum Foundation?

Danny Ryan: There are ongoing conversations in terms of whether there should be a formal relationship. But as seen by Vitalik and the EF’s grant to Etherealize, they’re aligned with Etherealize’s goals. The grant from the EF signaled legitimacy to Wall Street, who wants to speak to Ethereum. In theory, Ethereum is an incredible and decentralized piece of tech that shouldn’t need BD, but the Overton window has shifted and there are more centralized competitors pursuing those goals, so we found that Ethereum needs to do that too.