On a quiet Memorial Day of trading, we look at two divergences worth sitting with this week. First, HYPE's ETF inflows are outpacing what BTC ETFs saw at the equivalent point in their launch cycle, even as spot BTC ETFs post their worst week since January. Second, we dive into ORE, a Solana-native asset riding the privacy bid, though the real story is structural buy flows.

With US markets closed for Memorial Day, the tape was thin. But crypto never sleeps. A quiet but risk-on session saw BTC close +0.2% in the high-$77K range after a rough weekend, following Trump’s Sunday pronouncement that Iran negotiations were “proceeding in an orderly and constructive manner.”

We’ve seen this movie before, and it hasn’t so far ended with any meaningful reopening of the Strait of Hormuz. But, who knows, maybe this time is different.

Spot BTC ETFs bled ~$1.26B last week, the steepest weekly drawdown since late January, with May 18 alone accounting for $648M of single-day redemptions. Spot ether ETFs are in an even longer slump — 10 consecutive days of outflows through Friday. This is real flow-side weakness that hasn't fully resolved.

Equity benchmarks on the chart are flat by definition (no print), so the cross-sector dispersion today is an unusually clean read on intra-crypto positioning.

Modular (+13.2%) topped the leaderboard by a wide margin — more than double the next-best sector — primarily driven by TIA, which was up roughly 14% on Monday. Worth flagging that the underlying fundamentals haven't changed; Celestia currently sports modest daily activity and generates only $70-90 of REV, so this looks more like narrative-driven rotation piggybacking on the AI craze than a re-rating on usage.

Meme (+7.1%), DePIN (+6.2%), Launchpad (+2.8%), L2s (+2.2%), and AI (+1.8%) rounded out the top of the table.

On the downside, Perps (-2.5%), DeFi (-1.9%), and Privacy (-1.5%) lagged. Perps weakness is a consolidation after a strong week for this standout sector.

Within DeFi, ONDO dipped 6% following news of the death of one of its co-founders but subsequently recovered.

HYPE continues to show relative strength against the broader BTC/ETH ETF outflows. The two newly launched spot HYPE ETFs — 21Shares' THYP (launched May 12) and Bitwise's BHYP (launched May 14) — pulled in $28 million on May 21, bringing total HYPE ETF AUM to over $140M.

On a market-cap-adjusted basis, the inflows are outpacing what BTC ETFs saw at the equivalent point in their launch cycle. Bloomberg ETF analyst Eric Balchunas flagged the volume pattern as “very rare,” noting that new ETFs typically see volume fall after debut.

The token itself is up ~146% YTD, decoupling from other majors. The combination — fresh ETF rails, fundamentals tied to fee buybacks via the Assistance Fund (Bitwise has also committed 10% of its management fees to acquiring HYPE for its balance sheet), and HIP-3 expanding the product into synthetic pre-IPO perps — explains why HYPE keeps catching a bid while BTC ETF flows go the other way.

— Macauley

The Mines Reward Conviction

Aside from perps, one of the hottest sectors over the past few weeks has been privacy.

Attention has mostly centered on Zcash and, more recently, on names like Near and Railgun. On Solana, one smaller asset has also benefited from the broader privacy bid: ORE, which is up about 50% over the past week. 

ORE has become privacy-adjacent through its integration with PrivacyCash, which offers a shielded pool for stORE, ORE’s liquid staking token. But while privacy may have brought attention back to ORE, the more interesting story is structural buy flows.

ORE self-describes as a “Solana-native store of value token.” It has a capped max supply of 3 million tokens, no insider or team allocation, and programmatic issuance through “mining.” Based on recent buyback activity, the token appears to be trading at roughly 2x P/S on a circulating basis, putting it in a very different category from most narrative-driven privacy tokens.

ORE’s mining process is intentionally different from traditional proof-of-work. In practice, it functions more like an onchain lottery-style game. Each round, miners have one minute to deploy SOL across a 5x5 grid. At the end of the round, one winning block is selected using onchain randomness. Miners who claimed space on the winning block receive the SOL deployed on losing blocks.

Over the past few weeks, SOL deployed for mining has been trending higher. As seen below, miners deployed an average of $1.29M worth of SOL per day over the past week.

In addition, the protocol mints roughly 1 ORE per minute as part of the mining process, distributing rewards to miners on the winning block. Despite the game-like structure, retention has been notable: of roughly 800 daily active miners, about 93% are recurring rather than new wallets.

ORE collects 10% of all SOL mining rewards as protocol revenue. That revenue is automatically used to buy back ORE from the open market. Of the ORE purchased through buybacks, 90% is burned (i.e., removed from circulating supply), while 10% is distributed to stakers as yield.

This creates a highly reflexive loop: more mining activity generates more SOL revenue, which funds more ORE buybacks, which supports token demand and staking yield, which can make mining and holding ORE more attractive.

The protocol has spent $2.71M in buybacks over the past 30 days, with a weekly uptrend observed over the past three weeks.

Considering both daily ORE issuance and ORE removed from circulation, current buyback activity would imply a 42% annualized dividend yield on a $77M market cap, using a one-year forward projected supply of 572K ORE, assuming buybacks continue at the same rate.

An important caveat is that burned ORE should not be treated the same as a permanent burn. Burned ORE reduces circulating supply, but it can be re-minted as long as circulating supply remains below the 3 million token cap.

ORE also has a “refining” mechanism that favors miners with a long-term horizon. When ORE mining rewards are claimed, a 10% fee is redistributed to other miners proportionally to their unclaimed rewards. Miners who wait longer to claim can receive more refined ORE, while short-term claimers subsidize longer-term participants.

Currently, there is roughly 90K ORE in the refinery, or unclaimed rewards, representing almost 20% of circulating supply.

The key question is whether mining activity and speculative demand can persist. ORE’s model is highly reflexive: a higher token price makes the mining game more attractive, which can drive more activity, revenue, and buybacks. But if speculative demand fades, the incentive to mine weakens, revenue falls, buybacks decline, and the flywheel starts to unwind.

Privacy may have brought attention back to ORE, but the real story is structural flows: how much SOL miners deploy, how much revenue gets converted into buybacks, and for how long the reflexive loop can hold. 

— Carlos

1. Pareto: Institutional Credit Vaults

Serotonin published a piece on Pareto arguing it is emerging as a key infrastructure layer in onchain credit by connecting onchain capital to institutional borrowers through bespoke credit vaults. The piece explains that Pareto sits across multiple parts of the stack — vault infrastructure, capital allocation, and asset management — with its core product being credit vaults that extend undercollateralized or custom credit facilities to firms like FalconX, RockawayX, Fasanara, and Bastion Trading under manager-defined terms.

It highlights Pareto’s growth to roughly $171.5M in deposits, the growing use of vault receipt tokens as collateral in DeFi, and the protocol’s synthetic dollar USP as a permissionless way to access these vaults. The broader takeaway is that Pareto is helping bring institutional-style credit onchain in a form money markets can’t easily replicate, with further expansion expected through new chains, tranching, white-labeled vaults, and a future PAR token launch. 

2. Solana Must Win Sunday

Brian Smith from Jito Foundation published an article arguing that Solana “must win Sunday” because onchain perps are becoming the first place TradFi traders price risk when legacy markets are closed, making derivatives a Trojan horse for bringing much more of traditional finance onchain. He argues the real opportunity is not just today’s fee pool, but owning the gateway through which traders discover that crypto rails let them trade crude oil, gold, pre-IPO equities, and other assets on weekends and outside market hours. While Solana already has the technical foundation to dominate this category, he says Hyperliquid has pulled ahead by building specifically for derivatives traders, proving that product quality and liquidity matter more than raw infrastructure. JTX is framed as Jito’s answer to that gap — and part of a broader push to make Solana the default venue for internet capital markets.