The convergence of crypto and traditional finance (tradFi) seemed to reach a fever pitch this week, with institutional adoption taking center stage as the dominant narrative. More corporate entities reported engaging in crypto acquisitions. BMNR (Bitmine Immersion Tech) intends to operate an ETH treasury, citing the long-term value proposition of ETH. Similarly, TAOX (TAO Synergies), previously known as Synaptogenix or SNPX, changed its ticker to signify a new strategic direction focused on TAO accumulation and staking.

Meanwhile, in June, US based spot bitcoin ETFs attracted a large US$4.6B in net inflows comparable to the $5.2B in May, bringing their total market cap to over $75B. (See Chart 1.) In a historic milestone, BlackRock's iShares Bitcoin Trust ETF (IBIT) has now surpassed its flagship S&P 500 ETF (IVV) in annual fee revenue generation, earning $187M annually despite being a fraction (1/8th) of the size. Separately, the SEC put a stay order on its initial approval of Grayscale's Digital Large Cap Fund (GDLC) conversion to ETF status on July 2, which would have made this one of the largest crypto index ETFs (with $755M in AUM) globally.

Monthly US based spot crypto ETF net inflows

Interestingly, we also saw spot ETH ETF inflows gaining traction in June with $1.16B in net inflows, an unprecedented surge for these instruments motivated by greater institutional participation in the CME basis trade. According to CFTC, leveraged funds’ short positions in CME ETH futures have climbed from $466M in early May to $1.6B as of June 24, a difference of $1.14B that maps closely to the increase in ETF inflows. The basis yield on offer for CME ETH futures (vs spot) increased from 6% on average in February to 8-9% in May and June.

CFTC leveraged funds short CME ETH futures positions

Going into the weekend, with nonfarm payrolls out of the way, we expect markets to pivot from focusing on monetary policy to concentrating on fiscal policy. In particular, the signing of the legislative tax cut and spending bill (One Big Beautiful Bill Act) may be a major positive market catalyst, following its approval by Congress. Although no major crypto tax amendments were ultimately included in the bill, we think the approval of the OBBBA should be supportive for the asset class because it promises to unlock more liquidity. However, a caveat is that raising the debt limit cap may allow the US Treasury to rebuild its Treasury General Account (TGA) balance in the short term (though the overall liquidity effects here can be quite nuanced). This forms part of the rationale behind our constructive outlook for 3Q25.

Tokenized Pre-IPO Stocks Go Live: OpenAI and SpaceX Now on Blockchain

Last week, equity-tokenization moved from concept to reality. Two platforms took an unprecedented step: they opened tokenized exposure to private, pre-IPO giants. Robinhood’s EU roster includes OpenAI and SpaceX while Republic has begun taking reservations for OpenAI, SpaceX and Anthropic tokens. Both OpenAI and Elon Musk have publicly criticized these offerings, asserting they do not represent real equity—a valid point, as these tokens are not intended to confer ownership. Instead, they are derivatives that track share prices, enable 24/5 trading, and can be bought, sold, or held without granting ownership rights. For the first time, retail investors can access pre-IPO valuations, previously reserved for only accredited investors and institutions. Once trading kicks off, it will be important to track how the data reveals pent-up demand for pre-IPO equity on public blockchains.

Separately, Robinhood and Backed Finance each put public stocks and ETFs onchain—Robinhood listed 200+ US names on Arbitrum (migrating later to its own L2), while Backed Finance’s xStocks added roughly 60 tickers across Bybit, Kraken and Solana.

Early onchain data suggest genuine appetite. Volumes on Solana for xStocks climbed from ~$1M on June 30 to more than $8M within two days, while daily active wallets briefly exceeded 6.5k as traders flocked to SPYx, TSLAx and other blue-chip tickers (Chart 3). Early trading shows a sharp burst in liquidity, seemingly led by retail wallets, but with only three days of data it’s too soon to know whether this momentum will persist or fade.

xStocks Solana volume & user metrics

Arbitrum, the temporary settlement layer for Robinhood’s stock tokens, has already begun to show a different usage profile. For most of the year, its trailing 30-day average (T30D) daily active addresses had been drifting lower even as total transactions held firm, likely signaling a market dominated by power users and bots. Since June, that relationship has flipped—new wallets are climbing while transaction counts remain high—likely pointing to fresh retail participation alongside existing high-frequency flow (Chart 4).

Arbitrum user activity (trailing 30D average)

The broader liquidity backdrop is turning more supportive as well. Stablecoin balances across major L2s have reached a record $12B, with Arbitrum commanding the highest share among all L2s and growing 35% in the last two months (Chart 5). A deeper dollar float should make it easier for venues to quote narrow spreads on tokenized equities and eventually enable leveraged or options products.

L2 stablecoin market cap share

Taken together, this week’s tokenization frenzy marks the first credible attempt to pull equity trading into the crypto stack at scale. If initial wallet and volume figures persist, equities could join dollars and Treasuries as the next real-world asset class to find meaningful product-market fit on public blockchains—well ahead of most expectations.

Crypto-Friendly Banks Emerge: Circle, Ripple, and Erebor Lead the Charge

A collective of tech magnates led by Palmer Luckey of Andruil and Joe Lonsdale of 8VC with backing by Peter Thiel have launched a new bank, Erebor, which will cater primarily to tech start-ups and crypto entrepreneurs. Erebor is seeking to fill the void created by the collapse of Silicon Valley Bank (SVB) in early 2023, which had previously serviced many of the clients Erebor is now targeting. The bank plans to focus on holding stablecoins and applied for a banking charter last month. By doing so, Erebor aims to provide banking services that may be unavailable to crypto projects.

Similarly, on Monday (June 30) Circle Internet Group, Inc. (NYSE: CRCL) applied for a national trust bank charter with the Office of the Comptroller of the Currency (OCC), a move which would allow the company to manage the reserve assets behind its stablecoin USDC, as well as offer custody solutions to institutional clients in the future. The move will also allow Circle to potentially meet the expected requirements of the GENIUS Act. On Wednesday (July 2), crypto firm Ripple also took steps to apply for a bank charter, primarily to boost the company’s offerings and federal oversight of its own stablecoin, RLUSD. With a national trust bank charter, neither firm gains the ability to accept cash deposits or issue loans.

Solana Staking ETF Launches in the U.S.: Yield Meets Regulation with SSK

SSK—the REX-Osprey Solana + Staking ETF that began trading on Cboe BZX on July 2—delivers the first US-listed vehicle with both spot SOL exposure and native staking yield. To reach the market, the sponsor bypassed the SEC’s current staking roadblock by instead registering the fund as a 1940-Act investment company, then listed it under the exchange’s generic ETF-rule framework. That choice forced a hybrid portfolio: ~55% directly held SOL and ~45% in foreign-domiciled Solana ETPs (plus a small sleeve for liquid-staking tokens). The foreign-fund sleeve allows the product to meet the 1940-Act definition of an “investment company,” but it also introduces extra layers of custody, tracking error, and fees.

Because the portfolio does not qualify as a pass-through regulated investment company (RIC), SSK is taxed as a C-corporation. The fund therefore pays tax on realized gains before passing after-tax income to shareholders, who are then taxed again on the distribution—a double-tax structure that, together with a 0.75% management fee, pushes total expenses to 1.40%. That cost sits well above spot BTC and spot ETH ETFs and will be an enduring performance drag once lower-fee, grantor-trust products arrive.

Investor response nevertheless underscored latent demand for yield-bearing crypto ETPs: day-one trading volume reached ~$33M with ~$12M of net inflows, placing SSK well above other niche altcoin-futures products, albeit well below major spot BTC & ETH ETFs (Chart 6). The strong open also coincided with near-record open interest in CME SOL futures (~$166M), suggesting institutions may be ramping up efforts to hedge or speculate on the implications of lower-cost grantor-trust-style staking ETFs gaining approval.

ETF launch day volumes

SSK proves that on-chain staking rewards can be wrapped inside a regulated U.S. ETF, but its first-mover edge rests on a costly, tax-inefficient chassis. Larger issuers have pending filings for trusts that would avoid C-corp taxation and could undercut fees. Should the SEC approve those later this year—as many observers expect—SSK may shift from trail-blazer to placeholder.

Crypto Sentiment Turns Risk-On: Coinbase Volume Surges Amid BTC Rally

This week saw a decidedly "risk-on" sentiment in crypto markets, with the COIN50 index trading up approximately 5%. Bitcoin spearheaded this rally, challenging its all-time highs near $110,000, a level rejected seven times before. Interestingly, perpetual funding rates briefly flipped negative on Wednesday as BTC pushed past $109,000, suggesting traders were positioning for the resistance level to hold. However, by Thursday (July 3) morning over $250M in short liquidations went through as BTC once again traded above $110,000. Persistent USD weakness coupled with positive sentiment are clearly tailwinds for the token. However, one risk that bears watching is the potential for a shift in global liquidity dynamics. The "Big Beautiful Bill" includes a $5T increase in the debt limit. That could enable the US Treasury to rebuild its Treasury General Account (TGA). This TGA replenishment could potentially drain liquidity from the broader market in the short term, posing a notable downside risk for all risk assets.

Trading volumes on Coinbase platform (USD)

Trading volumes on Coinbase platform by asset

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