Trakx Weekly Update: Crypto Markets in Holding Pattern

Key Crypto Market Figures

CTIs Weekly Performance

Digital asset markets were in consolidation mode last week as reflected by the 0.8% dip in the value of our large cap Top10 Crypto CTI. The best performer amongst our indices was the Cardano Ecosystem CTI, after it gained 1.7%. Meanwhile, at the other end of the performance ranking was the NFT Metaverse CTI, following its 6.4% decline over the preceding seven days.

Central Banks On Hold

Crypto markets faced renewed macro headwinds as oil prices surged above $125 per barrel (a four-year high) amid stalled US–Iran negotiations and uncertainty around access to the Strait of Hormuz. Despite the just launched “Project Freedom”, a US-led naval escort initiative to secure shipping routes, concerns over a prolonged supply disruption persisted. Given the challenging macro backdrop generated by this negative global supply shock, several G7 central banks who held policy meetings last week decided to keep interest rates steady.

In the case of the Fed, the decision to leave the target funds rate unchanged was contested, with four members of the 12 strong committee voting against the statement – the highest dissent in over 30 years. Three of the members voted against an “easing bias” in the statement, while Trump appointee Miran, voted in favour of a 25bp cut. In explaining the board’s decision Powell, who chaired his final meeting as Fed governor, described US inflation as “elevated” – stronger wording than in the prior statement – and warned that higher oil prices were leading to higher inflation expectations. The manifestation of so-called second round effects is of concern to central bankers because it can lead to more persistent inflation pressures.

The split vote was not the only surprise. During the post-meeting press conference Powell announced that he intends to stay on the Fed board even after his term as chairman expires (he in entitled to stay until 2028). This is contrary to historic norms, where the outgoing chair vacates their position on the board in order to give the incoming chair (Warsh is well-placed to be nominated having been approved by the Senate banking committee by 13-11) a clear pathway. His rationale for staying was concern about the political attacks on the central bank – led by President Trump – which Powell views as jeopardizing the Fed’s independence. Furthermore, by not relinquishing his position on the board Powell is also denying Trump the option of appointing a central banker to side with Miran in pushing for lower interest rates. Overall, last week’s FOMC meeting had a more hawkish tone than investors expected, diminishing the prospect of easier US monetary policy in the months ahead, which helped push up US 30 year Treasury yields above 5%, levels not often seen in the two decades since the 2007/8 financial crisis.

Bitcoin Strategic Reserve Breakthrough

It has been over a year since the Trump administration created the US Bitcoin Strategic Reserve via executive order, making it the largest government-held crypto bag in the world. The sentiment boost from the announcement however, was capped due to the fact that the Bitcoin held in the reserve represented tokens that the federal government had already obtained through criminal or civil forfeitures. There was no announced plan to add to the stockpile via direct government purchases either when the reserve was established or last July when the White House published its crypto policy report, much to the disappointment of the crypto bulls. Things, however, might be about to change as last week at the Bitcoin 2026 conference in Las Vegas, Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets, told the audience to expect a “big announcement” in the coming weeks.

At the same conference it was also revealed that Senator Cynthia Lummis’ BITCOIN Act would be renamed the American Reserves Modernization Act. The legislation seeks to codify the US digital asset reserve by providing clear guidance on storage, access and holding periods, as such it seeks to put digital assets on the same footing as gold and other strategic asset reserves held by the US. Importantly, while the Treasury has still not yet signalled any intent to add to the Bitcoin stockpile, the bill proposes acquiring one million bitcoin over five years using “budget-neutral strategies”, which would constitute a new source of demand for crypto assets.

MiCA Deadline Approaches

Additional guidance and implementation of MiCA over the past week—particularly around strict stablecoin reserve requirements and the upcoming requirement for exchanges to obtain Crypto Asset Service Provider (CASP) licences by the July 2026 deadline or cease operations—has increased compliance costs and operational complexity. These rules are reshaping the stablecoin landscape within the EU by effectively forcing euro-denominated stablecoins to adopt highly conservative structures, including fully backed, segregated reserves and guaranteed redemption rights. While this makes them significantly safer and more transparent, it also limits their flexibility and yield potential, leaving them “safe but uncompetitive” relative to deeper, more liquid and widely used dollar-based alternatives.

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Ouch. The U.S. 30-year Treasury yield just hit 5% and bitcoin may pay the price: CoinDesk
• White House Crypto Adviser Hints at ‘Breakthrough’ Bitcoin Reserve Move: Decrypt
• Hegseth recasts Bitcoin as national security asset amid Russia, China expansion: DLNews
• What Is MiCA? How the EU Regulates Cryptocurrency Markets in 2026: Bitcoin Foundation
• U.S. senators ban themselves from prediction markets trading: CNBC
• Arbitrum DAO starts vote to release 30,766 frozen ETH to DeFi United, following Kelp DAO attack: The Block
• Tokenized RWA market grows 420% since 2025 on regulatory clarity, access: Cointelegraph

Trakx News

• Ryan Shea published his latest Monthly Update explaining why digital asset markets have been the best performing asset class since the start of the Iran conflict.

Trakx CTIs Performance

Sources: Coingecko and AlphaVantage

*Return of bitcoin is calculated since 01/05/2020, while CTIs performances were calculated since their respective launch date.
**Includes simulated performance.
***The risk signal is determined according to the historical volatility level, the higher the riskier.

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Disclaimers: No Investment Advice. Index returns and statistics are for illustration only. Index returns do not reflect any transaction costs or expenses. Past performance does not guarantee future results. The information provided in this newsletter does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the newsletter content as such. Trakx.io does not recommend that any cryptocurrency should be bought, sold, or held by you. Readers shall conduct their own due diligence and consult their financial advisors before making any investment decisions.