📉 With major central banks pivoting toward rate cuts and inflation expectations creeping higher, the macro backdrop is quickly turning crypto-friendly.

Bitcoin remains resilient above $116K after hitting new highs last week, supported by strong ETF inflows and weakening dollar sentiment.

But with Jerome Powell’s speech on Tuesday and a packed calendar of U.S. economic data ahead, markets are on edge. Will macro policy reinforce the bull case, or crack the surface of recent strength?

Here’s what we’ll cover today:

Ready to make sense of this macro-crypto convergence? Let’s dive in.

Most major economies, including the U.S., Europe, and Asia are now clearly shifting toward interest rate cuts by the end of the year. Central banks are pivoting into easing cycles, creating a supportive environment for risk assets like Bitcoin. As borrowing costs fall, the opportunity cost of holding non-yielding assets like crypto decreases. We’ve already seen this play out in the past week, with ETF inflows into crypto assets accelerating sharply, further confirming this trend.

In the U.S., inflation expectations have been steadily rising since mid-2025, with the 10-year breakeven rate now nearing 2.45%. This signals that markets anticipate more persistent inflation than the Federal Reserve may be comfortable with. Normally, rising inflation expectations push investors toward hard assets, and Bitcoin is increasingly seen as "digital gold" in this context. Despite concerns earlier in the year, Bitcoin has remained resilient and is still up 26% year-to-date.

U.S. trade policy remains a source of market volatility. Tariff rates spiked as high as 25% in April before easing back to around 12% by mid-year. These sharp swings have added uncertainty to global trade and currency flows, weakening investor confidence in the U.S. dollar. In our view, this drives international capital toward alternative stores of value, further strengthening the long-term case for crypto.

The continuation of the “America First” approach presents structural challenges for the dollar, but acts as a tailwind for Bitcoin and the broader digital asset space.

When Bitcoin entered new all-time highs a little over a week ago, the Crypto Fear & Greed Index surged to a reading of 78, well into greed territory and just two points shy of extreme greed. Since then, we’ve seen a cooling off as anticipated, not just in price but also in sentiment, with the index now sitting at 72, still firmly in the greed zone.

During previous bull markets, and especially during parabolic runs in Bitcoin and other cryptocurrencies, this metric remained in extreme greed territory for many days or even weeks. This suggests that, based on sentiment alone, we’re not yet in extreme territory, leaving room for further upside.

Total Bitcoin Spot ETF inflows also remain consistently positive as we enter the new week. Last week didn’t see a single day of outflows, further confirming strong demand from institutions and the traditional finance sector. We expect this trend to continue, with no signs of major profit-taking on the horizon.