Crypto Assets market is about to迎来转折点, US inflation data may become key

Recently, the Crypto Assets market has continued to decline, primarily due to a lack of clear macro direction. Altcoins are also generally showing a similar trend, and the correlation between Crypto Assets remains close to its highest point since the beginning of the year. The current macro uncertainty confirms our view from April: the macro economy will continue to dominate Bitcoin's performance, US spot ETF inflows are gradually decreasing, and the market is beginning to look for other catalysts beyond Bitcoin halving.

Despite the European Central Bank and other institutions reiterating plans to cut rates this summer, higher-than-expected U.S. inflation data has raised concerns in the market about the Federal Reserve delaying rate cuts. This has led to a stronger dollar, which in turn has put pressure on the Crypto Assets market. However, the dollar's rally has stalled following the Federal Reserve meeting. After the non-farm payroll data on May 3 came in below expectations, market expectations for the first rate cut shifted from November to September 2024. The number of unemployment claims on May 9 exceeded expectations, further increasing the likelihood of accelerated rate cuts.

We believe that the US unemployment rate ( is currently 3.9%) and will not become a key focus for the Federal Reserve in the short term, as it remains close to historical lows. The US economy may be supported by technological advancements and government spending, and is unlikely to fall into recession. The next Federal Reserve meeting may still focus on inflation indicators, highlighting the importance of the upcoming PPI and CPI data, especially if they exceed expectations.

On the other hand, the first two days after a certain Bitcoin trust fund converted to an open-ended fund saw an inflow of funds. Although the reasons for the inflow are still unclear, this marks the completion of a structural capital rotation. We believe that the early outflows of funds were mainly related to bankruptcy proceedings, profit-taking from discounted trades, and a shift towards lower-fee products. Looking ahead, we expect that the fund flow data will not show structural distortions.

In terms of on-chain development, a certain lending protocol recently announced its fourth-generation protocol plan as part of its long-term roadmap for 2030. The new version includes several architectural improvements, such as a unified liquidity layer, fuzzy interest rates, and liquidity premiums. The plan also focuses on enhancing the use of its stablecoin and improving risk management and the clearing engine. While the mainnet is scheduled to launch in the second quarter of 2025, this announcement reflects the maturity of mainstream DeFi protocols in their core functionalities.

The expansion of DeFi protocol functions faces technical challenges, especially compared to traditional internet companies. Successful DeFi protocols rarely manage to seamlessly scale their initial architecture; instead, they deploy new versions and encourage liquidity migration. This cross-version migration often takes a long time, reflecting users' trust in mature protocols. This highlights the characteristics of smart contract immutability and how to maintain security amid rapid innovation.

Overall, we believe that the US inflation data in the coming week will be an important reference for the market. Unless there are significant surprises, market volatility may continue to narrow. Due to the lack of clear catalysts, the correlation between Crypto Assets and traditional markets may further increase. Institutional investors have low expectations for ETH spot ETFs, which may lead to ETH underperforming BTC. We will continue to monitor changes in the macro environment and their impact on the Crypto Assets market.