Bitcoin’s New All-time High

31st May 2025 • 13 mins read

Key Numbers:

Bitcoin US$ 104,621 (11.29%) Ethereum US$ 2,538.10 (43.77%)

1-month return

Total Crypto Market Cap US$ 3.39T (11.88%)

2025 returns

Bitcoin 9.78% Ethereum –25.53% Gold +26.17%

NASDAQ -1.02% S&P500 0.511%

Key Takeaways

• Bitcoin hit a new all-time high of $111,814 in early May, fueled by global M2 money supply expansion past $111 trillion.
• Momentum faded mid-month as Bitcoin formed a rising wedge and broke below it, retreating toward $103,000.
• U.S.–China tariff risks and an EU probe into Chinese tire dumping reintroduced geopolitical friction, dampening market sentiment.
• Spot Bitcoin ETFs recorded $25 billion in weekly volume, led by BlackRock’s IBIT with a 30-day streak of inflows and $430M added on May 23.
• ETFs now manage over $131 billion in Bitcoin, moderating volatility and strengthening institutional adoption across pension funds and endowments.
• U.S. inflation continued trending down, with headline PCE at 2.3% and the Fed holding rates steady at 4.25–4.50% amid balanced inflation and labor risks.
• A 90-day U.S.–China tariff truce reduced steep import duties but showed signs of fragility due to disputes over critical mineral exports.
• Japan’s 40-year bond yield surged to a record 3.675%, weakening the yen and pressuring global long-term yields through capital repatriation risks.
• U.S. PPI fell 0.5% in April, the largest drop since 2020, signaling disinflation and boosting market hopes of extended monetary policy easing.
• Ethereum gained 43% in May, outpacing Bitcoin, with ETH/BTC forming bullish technical patterns and institutional ETF inflows rising to $493M.
• The May 7 Pectra upgrade increased max validator stake to 2,048 ETH and enabled execution-layer withdrawals, enhancing staking efficiency and compounding.
• Ethereum-native TVL grew 20% to $61.25B, supported by strong network activity, over 403K daily addresses, and Pectra-driven validator upgrades.
• Coinbase revealed a bribery-based insider data breach, refused to pay a $20M ransom, and launched a $20M whistleblower fund to protect users.
• Cetus Protocol Sui was exploited for $220M due to a smart contract bug; $162M was frozen through coordinated validator action and community governance.

Bitcoin Market Analysis

This month, Bitcoin broke above its previous all-time high of $108,000, reaching a new peak of $111,814 as it tracked the global expansion of M2 money supply, which surpassed $111 trillion. The macro liquidity backdrop provided strong early-month tailwinds, reinforcing Bitcoin’s narrative as a hedge against fiat debasement. For several days, price action held between the $108,000 resistance and the $120,000 zone, forming a rising wedge—a typical sign of buyer exhaustion. Technical indicators reflected this slowing momentum: the RSI cooled from overbought levels into neutral territory, and the MACD line crossed below its signal line just as Bitcoin struggled to maintain elevation above prior highs.

Source: https://altfins.com/

By mid to late May, the momentum faded further as geopolitical tensions reemerged. The reintroduction of U.S.–China tariff escalation risks, along with the EU’s new probe into Chinese tire dumping, signaled growing protectionist pressure in global trade. These developments injected uncertainty into risk markets, dampening investor sentiment and slowing Bitcoin’s ascent. The price eventually broke below the wedge’s lower trendline and retraced toward $103,000, with the 200-day moving average near $94,800 emerging as the next major support. As macro tailwinds gave way to geopolitical friction, Bitcoin’s breakout rally gave way to consolidation, potentially setting the tone for a more cautious start to June.

In the week ending May 23, U.S. spot Bitcoin ETFs logged $25 billion in trading volume, the highest weekly total of 2025 to date and net inflows of $2.75 billion, more than double the comparable week in 2024. BlackRock’s IBIT fund led this surge, maintaining a 30-day streak without any outflows and attracting $430 million on May 23 alone. Moreover, spot ETFs recorded their largest inflows since early 2025, reflecting growing institutional confidence. 

Source: https://www.theblock.co/data/crypto-markets/bitcoin-etf

Those sustained ETF inflows are reshaping Bitcoin’s supply-demand dynamics. With spot ETFs now managing over $131 billion in assets under management with institutional allocators, pension funds, endowments, and family offices, increasingly viewing Bitcoin as a liquid, investable asset rather than a speculative hedge. As a result, realized volatility has shown signs of moderation, even as futures open interest reached record highs near $80 billion. Looking ahead, continued capital inflows via ETFs could help dampen sharp drawdowns, although any abrupt shift in monetary policy or regulatory guidance remains a key risk 

Source: https://www.theblock.co/data/crypto-markets/bitcoin-etf

Macro-Economic & Geopolitics

U.S. inflation continued trending toward the Federal Reserve’s 2 percent target in May, with headline PCE inflation at 2.3 percent and core PCE at 2.6 percent year over year. However, core services inflation remained sticky, reflecting underlying pressures in shelter and wage-related components. According to the May 6 to 7 FOMC minutes, policymakers viewed upside inflation risks, particularly from persistent services price pressures, as nearly balanced by emerging downside risks in the labor market. While the job market remained strong overall, the Fed acknowledged growing uncertainty around payroll growth and broader economic momentum. The federal funds rate was held steady at 4.25 to 4.50 percent, reaffirming the Fed’s data-dependent stance as it monitors both inflation progress and labor market resilience.

On May 12, 2025, the United States and China agreed to a 90-day suspension of certain tariffs enacted earlier that year. Under this agreement, U.S. tariffs on Chinese imports were reduced from as high as 145% to 30%, while China lowered its tariffs on U.S. goods from 125% to 10%. This temporary truce aimed to provide relief to exporters, particularly in sectors like electronics and solar-panel manufacturing, allowing them time to adjust to currency fluctuations and reconfigure supply chains. However, tensions resurfaced as U.S. officials accused China of not fully complying with the agreement, particularly concerning the slow reissuance of export licenses for critical minerals essential to various industries. China refuted these claims, asserting that it was adhering to the terms of the deal. This situation underscored the fragility of the truce and the complexities involved in U.S.-China trade relations.

On May 28, 2025, Japan’s 40-year government bond yields surged to 3.675 percent, the highest on record, after a weak debt auction signaled declining demand from domestic institutions like life insurers and pension funds. This spike reverberated across global markets, coinciding with a rise in U.S. 30-year Treasury yields as investors demanded higher compensation for long-duration risk. It also disrupted the yen carry trade, a strategy where investors borrow low-yielding yen to invest in higher-yielding foreign assets by raising domestic borrowing costs and reducing the profitability of these trades. As yields rise in Japan, investors are less incentivized to seek returns abroad, leading to potential repatriation of capital. This not only weakens demand for foreign bonds, such as U.S. Treasuries, but also exerts upward pressure on global yields. The weakening yen further complicates matters by increasing the cost of servicing foreign-currency debt.

Source: https://tradingeconomics.com/

With Japan’s debt-to-GDP ratio exceeding 248 percent, the poor demand in recent super-long bond auctions signals a growing investor preference for shorter maturities and higher yields pressuring sovereign issuers globally to reassess their own duration risk. This shift is particularly relevant for the U.S., euro area, and emerging markets, where rising benchmark yields could amplify debt-servicing costs and increase the risk of recession. If Tokyo reduces issuance of long-dated bonds or intensifies yield-curve control, it may temporarily cap domestic yields but reduce available liquidity in the global bond market. A continued selloff especially if Japan’s upcoming 30-year auction also underperforms could lift global yields further, tightening financial conditions worldwide. This would challenge central banks already walking a fine line between disinflation and growth and potentially redirect capital away from risk assets like equities and emerging-market debt, as investors shift to shorter, higher-yielding instruments.

On May 15, 2025, the U.S. Bureau of Labor Statistics reported that April’s Producer Price Index (PPI) fell 0.5 percent month-over-month, marking the sharpest decline since 2020 and surprising markets that had expected a 0.2 percent increase. Year-over-year, PPI eased to 2.4 percent from 3.4 percent in March, while consumer inflation also continued its descent, with the U.S. inflation rate dropping to 2.3 percent in April according to the latest CPI data. The combined signal of easing wholesale and consumer price pressures reinforced market expectations that the Federal Reserve could extend its rate pause. In response, Bitcoin briefly dipped below $102,700 before rebounding, and Ether rallied alongside broader risk assets, as traders interpreted the print as a dovish signal for monetary policy.

Source: https://tradingeconomics.com/united-states/inflation-cpi

Ethereum Post Pectra Upgrade

Ether (ETH) delivered a remarkable monthly return of approximately 43%, outpacing Bitcoin’s roughly 11% advance over the same period. U.S. spot Ether ETFs recorded cumulative net inflows of $493 million by month’s end, underscoring growing institutional demand. Analysts note that Ethereum’s ETH/BTC ratio formed bullish technical patterns—such as a cup‐and‐handle—suggesting the potential for further upside relative to Bitcoin. This strong relative performance likely reflects both macro tailwinds for digital assets and specific network developments that have rejuvenated Ethereum’s growth narrative. 

Source: https://altfins.com/ 

On May 7, 2025, Ethereum successfully activated its Pectra upgrade, raising the maximum stake per validator from 32 ETH to 2,048 ETH. By enabling large stakers to consolidate multiple smaller validators into a single “mega‐validator,” Pectra streamlines operations and reduces network overhead, as fewer overall validators are needed to secure the chain. This change not only lowers hardware and maintenance requirements for institutional operators but also unlocks true reward compounding: stakers can reinvest earned rewards directly into a single validator instead of managing dozens of separate 32 ETH nodes. Additionally, EIP‐7002 introduced execution‐layer withdrawals, allowing validator exits and partial withdrawals to be triggered on‐chain without requiring separate validator keys. These enhancements promise to improve staking liquidity—particularly relevant as larger staking pools and liquid‐staking protocols explore restaking strategies that permit staked ETH to be reused within DeFi lending and yield products. 

Institutional engagement with Ethereum broadened significantly in May. Beyond ETF inflows, trading volumes for U.S. spot Ether ETFs climbed steadily, buoyed by renewed conviction among pension funds and endowments that view Ether as a core liquid exposure to smart‐contract ecosystems. In parallel, centralized exchanges rolled out new yield‐bearing products—such as ETH staking services and liquid restaking derivatives attracted by Pectra’s improved validator economics. On the decentralized side, total value locked (TVL) in ETH‐based lending markets rose by nearly 8 percent, as optimized staking rewards fueled capital rotation back into DeFi. While Ether’s realized volatility stayed elevated relative to Bitcoin, these steady capital inflows and the launch of next‐generation institutional products suggest a maturing market structure that could dampen acute drawdowns. Looking ahead, continued ETF subscriptions combined with evolving staking derivatives may cement Ethereum’s status as a preferred institutional blockchain exposure.

Source: https://www.theblock.co/data/crypto-markets/ethereum-etf/spot-ethereum-etf-flows

Sector performance

In May 2025, the crypto market saw a sharp sectoral rotation led by Ethereum, which surged 41.6% on renewed interest in its upcoming upgrades and staking dynamics. Staking services (+25.1%) and privacy coins (+16.4%) followed closely, while Bitcoin posted an 11.0% gain, signaling steady institutional demand. Other strong performers included AI (+9.0%), exchange tokens (+7.5%), and DeFi (+6.7%), reflecting growing confidence in high-beta, on-chain narratives.

source: https://app.artemis.xyz/home

Meanwhile, Bitcoin dominance climbed to 64.5%, approaching its historical peak near 70%—a level where BTC typically begins to lose ground as capital flows into altcoins during “alt season.” Legacy sectors like data availability (–18.7%), bridges (–16.7%), and RWAs (–12.0%) struggled, while the strong relative performance of Ethereum, staking, and privacy sectors offers a potential preview of which narratives may lead the charge once altcoin capital rotation begins.

DeFi & CeFi Sector

By May 31, Total Value Locked in DeFi stood at $113.17 billion, reflecting a modest 0.43 percent gain over 24 hours and signaling incremental capital re-entering decentralized protocols. The stablecoin sector remained sizable, with a combined market cap of $247.70 billion, while 24-hour DEX volume reached $19.56 billion and perpetuals trading added another $7.34 billion—underscoring robust on-chain activity. Looking ahead, approximately $580.53 million in token unlocks were scheduled over the next 14 days, suggesting potential near-term increases in circulating supply. These metrics illustrate that, despite a pullback from earlier peaks, the DeFi ecosystem maintained healthy liquidity, significant trading turnover, and ongoing token distribution events as of late May.

Source: https://defillama.com/ 

As of May 31, 2025, the combined market capitalization of the top three stablecoins, Tether (USDT) at $153.724 billion, USD Coin (USDC) at $60.551 billion, and Ethena USDe (USDe) at $5.413 billion totaled roughly $247 billion. Ethena USDe, the newest among the top three, gained notable traction through its synthetic yield-bearing model, attracting users looking for alternatives to traditional collateral-backed stablecoins. Its rise is especially notable given that it surpassed DAI—a longtime leader in decentralized stablecoins in total supply, signaling a market shift toward capital-efficient, yield-generating designs over overcollateralized models. Together, these leaders shaped the stability layer of the crypto economy critical for trading, lending, and payments even as broader market volatility persisted.

Source: https://defillama.com/stablecoins

The convergence of DeFi and CeFi TVL growth underscores renewed attention on Ethereum’s ecosystem fundamentals. Native TVL on Ethereum rose from approximately $51 billion in early April to $61.25 billion by the end of May, marking a 20 percent increase and reaffirming Ethereum’s position as the leading smart contract platform. This recovery followed months of ETH underperformance against BTC, but the momentum shifted as the Pectra upgrade revitalized interest in the main chain. On-chain activity reflected this resurgence, with over 403,000 daily active addresses, chain fees exceeding $860,000, and stablecoin market cap on Ethereum reaching $123 billion. The upgrade’s improvements to validator efficiency and staking liquidity, combined with elevated inflows ($83.9 million in 24 hours) and strong DEX and perpetual volume, signaled growing conviction from both institutional and retail users.

Security & Risk Events

In May 2025, Coinbase revealed an insider-driven extortion scheme where overseas support agents were bribed to leak sensitive user data. No funds were stolen, but attackers demanded a $20 million ransom, which Coinbase refused to pay. Instead, the company launched a $20 million whistleblower reward fund, committed to reimbursing affected users, and shifted support operations back to the U.S. While the breach exposed the human layer as a key vulnerability, it also drew attention to potential regulatory scrutiny under U.S. and international privacy laws. (Coinbase, MarketWatch)

Cetus Protocol, a key DeFi project on the Sui blockchain, suffered a $220 million exploit in May 2025 due to a smart contract vulnerability in its liquidity calculation. In a rapid and coordinated response, the Sui Foundation, validators, and core developers acted to freeze approximately $162 million of the stolen assets, leveraging Sui’s network architecture to limit damage. A community vote soon followed, approving the transfer of frozen funds to a multisig wallet jointly controlled by Cetus, the Sui Foundation, and OtterSec for secure recovery and remediation. The team also offered a $6 million white-hat bounty to the attacker, signaling a proactive blend of protocol-level coordination and crisis management.