The cryptocurrency market showed a volatile trend this week, with both Bitcoin (BTC) and Altcoin (Altcoin) in a wide range. The Market Sentiment Index declined to 73% from 88% last week, and despite the significant decline, it remained in the long range overall, indicating that investor confidence has weakened but has not yet turned pessimistic.

Stablecoin Market Dynamics

The performance of the stablecoin market was divergent, showing clear geographical capital flow characteristics:

USDT: market capitalization of 150.7 billion U.S. dollars, week-on-week growth of 0.67%, a one-week increase of more than 1 billion U.S. dollars, to continue to maintain the upward trend。

USDC: market capitalization of $60.5 billion, down 0.65% week-on-week, has been three consecutive weeks showing a downward trend。

This phenomenon is worth focusing on investors: the continued growth of USDT indicates that institutional funds, mainly non-US users, are increasing their entry; while the continuous decline of USDC, although partially affected by Coinbase's restriction on USDC mining eligibility, is more likely to reflect the trend of capital outflows from US investors, a signal that needs to be continuously monitored.

Top 3 Macro Factors Driving Crypto Market Volatility in 2025

This week's market oscillations were mainly influenced by the following macro factors:

1. U.S.-China trade relations: The U.S.-China tariff talks reached an easing on Monday and issued a joint announcement, triggering some investors to “Sell the news” (good to cash) behavior.
2. Inflation data: the U.S. April quarterly CPI annual rate of 2.3%, lower than expected for the third consecutive month; core PCE remained at 2.8%, in line with market expectations
3. Fed position: Chairman Powell made hawkish remarks on Thursday, clearly stating: Short-term CPI fluctuations are not enough to affect the Fed's interest rate decisions Adhere to the 2% inflation target unchanged Cautious about short-term rate cuts Will not hastily ease monetary policy due to strong employment or slight price declines

Risk Warning and Outlook Investors should remain cautious and pay close attention to the following risk factors:

1. Progress of U.S. tariff negotiations with Europe, Japan and South Korea
2. The finalization of US-China tariff policies
3. The impact of the Fed's continued hawkish stance on market liquidity

Under the influence of multiple uncertainties, the cryptocurrency market will likely continue to maintain an oscillating pattern, and investors are advised to wait for the finalization of policies and events before making decisions.

Crypto Market Forecast: Key Tokens and Events to Watch Next Week

Bullish Mark: SOL

SOL: Execution-Driven DEX and Internet Capital Markets Dual Drive to Open New Era of Blockchain Assets

The new concepts of execution-driven DEX and Internet Capital Market (ICM) have recently appeared on Solana chain, and these in turn provide a new development direction and narrative for the development of Solana chain, especially the Internet Capital Market (ICM) has found a new development direction for the new Launch platform on Solana, which opens up a new round of paths to drive the development of Meme, thus further boosting Solana's growth.

The Rise of Execution-Driven DEXs

Solana Chain decentralized exchanges (DEXs) are shifting from the traditional public liquidity model to “execution-driven private liquidity DEXs,” which are attracting more institutional capital into the ecosystem by significantly improving trading efficiency and capital utilization through efficient execution and selective quoting strategies.

New DEX features: DEXs such as SolFi, Obric v2 and ZeroFi no longer maintain a public interface or user deposits, but instead route trades through the Jupiter aggregator, relying on internal vaults and prognosticators for pricing, avoiding slippage, temporary losses and arbitrage.

Selective quoting strategy: Provides liquidity only when inventory and market conditions are favorable, reducing adverse selection risk and improving execution efficiency.

Real-world performance: These DEXs have accounted for 40-60% of Jupiter's routing volume, peaking at over 65%, and primarily handle highly liquid pairs (e.g. USDC/USDT and SOL).

Technical support: Solana's high performance (fast finality and low latency) makes this model possible, reinforcing its market positioning as a high-performance trading platform.

Realization of the Internet Capital Markets (ICM) vision

Solana is building an open, license-free global financial infrastructure through innovative asset issuance platforms such as Believe, making it easy for more users and creators to participate in asset trading and driving network effects in the ecosystem.

ICM's core goal: to build an open, permission-free decentralized financing and trading ecosystem that allows global Internet users to participate in asset trading, breaking the geographical and regulatory restrictions of traditional finance.

Innovative platform practice: Believe platform has achieved explosive growth through the low-threshold token issuance mechanism of the social context portal (e.g., you can create tokens by replying @launch + token name on X platform), and the market value of its platform coin, LaunchCoin, exceeded $237 million in a few days, with a 24-hour revenue of $7.62 million.

Actual product support: Unlike purely speculative projects, tokens launched on Believe are often backed by actual product prototypes or concepts (e.g., DUPE and SuperFriend), providing creators with a direct revenue channel while attracting more developers and users to the ecosystem.

Transitioning from Narrative-Driven to Real-World Asset Capture

Solana is shifting from a Meme Coin-dominated speculative narrative to an asset tokenization model centered on real-world value capture to build a more sustainable growth path by supporting the financing and trading of real-value projects.

Current Problem: The on-chain token market is flooded with Meme coins and shell projects, and tokens lacking intrinsic value dominate.

Solana's solution: Through its technology advantages and new asset launch platforms (e.g. Believe), Solana combines tokens with actual products or ideas to support the financing and trading of real-value projects.

Technology Adaptability: Solana's high throughput and low latency features are suited to the issuance and trading needs of a wide range of assets, including Meme coins, NFTs, and startup project tokens.

Long-term value growth: Based on real-world applications and value creation, Solana's ecosystem is shifting from speculative bubbles to value capture, setting the stage for long-term growth.

Solana on-chain data

From the chart, we can see that the Solana chain as a trading volume, the size of the trading volume on its chain directly determines the development trend of Solana as well as the strength of the price of SOL tokens, and the trading volume of DEX on the Solana chain has seen a relatively large increase this week, with the highest single-day trading volume reaching the level of 4.564 billion U.S. dollars, and thus we can conclude that with the recent recovery of Meme coins on the Solana chain, it has also driven trading activity across the Solana chain.

Chain costs

From the chart we can see that Solana's on-chain fees have seen a rapid rise in the recent past, peaking at a level of $3.24 million in a single day, proving that the recent revival of Solana's eco-activities has been driven by the Meme recovery.

Why PIXEL and PYTH Face Bearish Pressure: Token Unlocks and Market Risks Ahead

PIXEL: Metaverse Farm game faces unlocking pressure, 89.36 million tokens release stacked with 45% rise may trigger pullback risk

Pixels is a meta-universe farm game launching in 2021 and is a project that combines elements of GameFi and NFT.The GameFi and NFT tracks have underperformed in this round and lacked a wealth creation effect, thus losing market traction as well as new players, which has led to the GameFi project consistently underperforming in recent years.PIXEL will be unlocked on May 19th PIXEL will be unlocked on May 19th with 89.36 million PIXEL tokens, accounting for 1.79% of the total locked volume, and as can be seen from the linear unlocking chart published in the whitepaper, the main targets of this unlocking are investment institutions and project teams. And because PIXEL's current market capitalization is low at only $4,198, and this week's rise with the broader market has reached a large margin of 45.31%, in the short term there is a need for a retracement, so this large amount of unlocking may trigger a large sell-off, which will have a certain impact on the price of PIXEL tokens.

PYTH: Biggest Unlock Ever Nears, 2.833 Billion Tokens to Be Released, 65% Surge in Circulation Sparks Market Concerns

Pyth Network is a prognosticator project that aims to provide real-time, accurate financial market data to enhance the functionality and reliability of decentralized finance (DeFi) applications.Pyth Network has been performing well lately, but PYTH will have 2.833 billion PYTH tokens to be unlocked on May 19, which accounts for 28.33% of the total lockup, the the largest unlocking of its program. At this stage, the circulation rate is only 43.33%, which is equivalent to an increase of 65% on top of the existing amount of tokens in circulation, and as can be seen through the linear unlocking chart published in its whitepaper, the main targets of this unlocking are investment institutions as well as project teams. And because Pyth Network's recent daily trading volume is around $10 million, which is very small, the new PYTH that will appear after this large unlocking will inevitably be much larger than the market's purchasing power, which will have a certain impact on the price of PYTH tokens.

Crypto Market Sentiment Index Drops to 73%: What It Means for Investors

The Market Sentiment Index declined to 73% from 80% last week and remains in a long range overall.

Top Performing Crypto Sectors This Week: Meme Coins Lead, SocialFi Lags

ETH Breaks $2,700 & Pectra Upgrade: Double-Sided Signals of Technical Improvements & On-Chain Data

ETH's performance this week was stronger than the broader market, breaking through the upper edge of the previous oscillator range of $2,000, and the highest has broken through $2,700 per coin. This week's trend was significantly stronger than Altcoin, and also drove the upward trend of the cottage market. After the recent strengthening of ETH has been widely discussed by the market, the Pectra upgrade, which was less discussed in the market before, has also received renewed market attention after this rise.**

Pectra Upgrade

The Pectra upgrade, completed on May 7, 2025, focuses on the optimization of the Staking mechanism, L2 expansion, and account abstraction, laying a new technical foundation for the future development of Ether, improving network performance, lowering the threshold for users, and creating favorable conditions for the long-term healthy development of the ecosystem.

Staking Mechanism Optimization

Through EIP-7251, the upper limit of single-node pledging was raised from 32 ETH to 2048 ETH, and Pectra upgraded to improve the efficiency of fund flow, prepare for future network congestion, and at the same time reserve technical space for L1 expansion, and through EIP-6110 and EIP-7002 to provide the underlying support for the LST protocol, so as to enable a higher degree of decentralization and automation of the links that originally relied on the centralized components. degree of decentralization and automation, which undoubtedly frees up more development space for the LST ecosystem despite the controversy.

L2 Optimization and Expansion

Pectra upgrades EIP-7742 and EIP-7691 to double the capacity of the Blob and support dynamic adjustment, as the core area of L2 data storage and backup, this improvement directly reduces the cost structure of L2, so that the transaction costs from “very cheap” to “extremely cheap”, although it may lead to a slowdown in the rate of ETH combustion, but in terms of the overall health of the ecosystem, the L2 activity and low cost has a more long-term strategic value. Although it may lead to a slowdown in ETH burning speed, from the perspective of the overall health of the ecosystem, L2's activity and low cost have a more long-term strategic value.

Account Abstraction Progress

The introduction of EIP-7702 opens a new chapter for ethereum account abstraction, which significantly improves the flexibility and user experience of wallets by supporting batch transactions, allowing the use of any token to pay for Gas, and introducing mechanisms such as social retrieval, etc. In the future, wallets based on this technology for account abstraction will be even more free and smarter, and new users can even register to use the wallet directly through their cell phone numbers without worrying about tedious steps such as address management and Gas presetting. No need to worry about address management and Gas pre-setting and other cumbersome steps.

Overall, the Pectra upgrade represents that Ethernet is gradually solving the long-term constraints on its development, such as network congestion, high costs and user thresholds, and preparing for a wider range of application scenarios and user groups in the future.

BlackRock Files Revised Physical Redemption Mechanism for Ether ETFs

BlackRock filed a revised S-1 on Monday for its Ether Spot ETF, $ETHA, with the main change being the addition of the phrase “allow for in-kind creation/redemption subject to SEC approval”.

BlackRock's application for an in-kind redemption mechanism for the Ether ETF ($ETHA) allows authorized participants to create or redeem ETF shares directly in ETH, rather than through cash transactions, thus allowing the ETF price to more accurately reflect the actual market value of Ether. This direct interface not only improves market efficiency and reduces price deviation, but also lowers transaction costs and creates a better experience for investors. For institutional investors, the physical redemption mechanism means a smoother large transaction process and lower tracking error, which will significantly increase their willingness to allocate ETH.

In terms of supply and demand, the creation of ETF shares requires the actual purchase of ETH, which will directly increase market demand; at the same time, a more efficient price discovery mechanism will help to reduce short-term price volatility and provide a more stable environment for ETH growth. Based on the current stage of the SEC's friendly attitude toward the Crypto industry, the market generally expects the application to approve the mechanism at some point this year.

Chained Data

As can be seen from the chart, the on-chain TVL of Ether reached $61.291 billion, up 21.15% year-on-year, which shows that the TVL on the Ether chain is on a rapid upward trend, and although the price is much different from that in November-December 2024, the on-chain TVL is already close to the $72 billion value at that time, which represents a more active activity on the Ether chain in the current stage compared with that of November-December 2024, and represents a more active activity on the Ether chain at this stage compared with that in November-December 2024, and represents a more active activity on the chain. -December 2024, representing more active activity on the Ether chain at this stage than in November-December 2024.

DEX and Perpetual DEX Trading Volume Surge: Key Trends on the Ethereum Network

As can be seen from the chart, the on-chain DEX trading volume of Ether has shown a continuous upward trend since the beginning of May, and has reached a recent high of $10.598 billion this week; and the volume growth of Perp DEX is even more obvious, and has reached the highest volume in the past six months of $7.384 billion this week. As you can see, the Ether ecosystem has also seen a recovery with the price rebound, and the on-chain volume has grown significantly.

Number of addresses on the chain / number of active addresses on the chain

From the above chart, we can see that the number of addresses on the ethereum chain had a significant growth trend this week, reaching 466,800, and it also belongs to a higher value in the last three months. Moreover, the number of active addresses on the Ether chain also showed a significant increase, which can reflect that the participating users on the Ether chain are also more actively participating in the chain activities with the recent rebound of the market, and can also reflect the recovery of the Ether chain ecosystem.

Number of stablecoins on chain

As you can see, the number of stablecoins on the ethereum chain, while down from its recent high of $124.9 billion, down to $122.6 billion, a decline of 1.84%, has remained stable overall and is among the higher levels in history.

Flow of Funds on the Ether Chain

As we can see, while activity on the Ether chain has been growing very rapidly in recent times, the Ether chain is still in an outflow mode.

Number of ETH transactions on chain

As can be seen from the graph, the demand for ETH on the Ether chain is clearly on the rise, which can be seen as a side effect of the fact that the activity on the Ether chain has seen a large increase in activity, thus boosting the demand for ETH.

Is the Crypto Recovery Real? Key Takeaways from This Week’s On-Chain and Market Data

Ether's price exceeded $2,700 this week, outperforming the broader market, Pectra upgraded with technical improvements to the Staking mechanism, L2 expansion and account abstraction, and BlackRock submitted an application for a physical redemption mechanism for ETH ETFs to help boost the sentiment of ETH holders, but the data on the chain is showing complexity: it's clear to see that although there is a recovery on the chain (TVL reached $61.291 billion, DEX transaction volume increased to $10.598 billion, and the number of active addresses increased), the most important money flow in an ecosystem is experiencing outflows. We can clearly see that although there is a recovery on the chain (TVL reached $61.291 billion, DEX transaction volume increased to $10.598 billion, and the number of active addresses increased), the most important flow of funds in an ecosystem is the phenomenon of outflow. Therefore, we should keep a cautious attitude towards whether the Ether ecosystem is really recovering, and keep watching the trend of the data on its chain.

Overall overview of market topics

By weekly returns, Meme track is the best performer while Socialfi track is the worst performer.

Meme track: DOGE, SHIB, PEPE, TRUMP accounted for a larger proportion in Meme track, the total proportion is: 89.64%, this week its rise and fall were: 18.96%, 7.81%, 36.83%, 3.79%, it can be seen that the main projects in Meme track are in the rising trend this week and most of the tokens rose by a large margin, thus This makes the Meme track the best performer.

Socialfi track: TON and CHZ accounted for a larger proportion in Socialfi track, with a total proportion of 94.74%, and their rise and fall this week were -2.38% and 7.51% respectively, because TON accounted for a larger proportion in SocialFi track, accounting for 89.66%, and was in the downtrend this week, so it made the worst performance in SocialFi track.

Preview of next week's big Crypto events

Thursday (May 22) U.S. Initial Jobless Claims for the Week

Friday (May 23) Solana Hosts Accelerate 2025 Crypto Summit in NYC

Weekly Crypto Market Summary: Key Insights, Token Trends, and Upcoming Events

The crypto market has been oscillating this week amidst a complex macro environment, with the market sentiment index dropping from 80% to 73% but still in the long range. The “Sell the news” effect of US-China tariffs easing was counterbalanced by lower-than-expected US CPI for the third consecutive month, while Fed Chairman Powell's hawkish comments further increased market uncertainty. The stablecoin market is polarized, with USDT growing by more than $1 billion, indicating the continued entry of non-US funds, while USDC declined for three consecutive weeks, alerting to the possible exit trend of US investors.

Looking ahead to next week, investors should keep a close eye on important events in terms of tariff progress between the US and the EU, among others. Although the data on the ethereum chain shows that activity is picking up, funds are still flowing out, and the sustainability of the recovery needs to be further observed, and it is not certain whether the chain ecosystem is really seeing a reversal. Against the backdrop that the US tariff policy has not yet been finalized and the Fed maintains its tough stance, market participants should remain cautious and wait for the finalization of policies and events.

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