Bitcoin Rally Pushes Biggest Token Further Into Record Territory

Cryptocurrency

Summary:

Bitcoin climbed as much as 3.4% on Thursday to hit a record of $111,980, before paring some of the increase. Smaller tokens also rose in a broad rally, with second-ranked Ether at one point up about 7.3%.

Bitcoin surpassed $111,000 for the first time, with traders increasingly bullish on the prospects of the original cryptocurrency amid mounting institutional demand and support from Donald Trump’s administration.

The new highs came on the same day that the president was hosting a dinner for top holders of his own $Trump memecoin at his golf club near Washington, an event that has drawn criticism from Democratic lawmakers and ethics experts who accuse him of selling access.

“The U.S.A. is DOMINATING in Crypto, Bitcoin, etc., and we are going to keep it that way!,” Trump wrote on Truth Social on Thursday evening in a post saying he was on his way to the dinner.

A wave of optimism is buoying Bitcoin after the advancement of a key stablecoin bill in the US senate fueled hopes of greater regulatory clarity for digital-asset firms under Trump, who is avowedly pro-crypto. Surging demand from Michael Saylor’s Strategy — which has stockpiled over $60 billion worth of Bitcoin — and a growing list of token hoarders is another driving force behind the rally.

“It has been a slow motion grind into new all-time highs,” said Joshua Lim, global co-head of markets at FalconX Ltd. Buying by entities like special purpose acquisition companies, or SPACs, is helping drive prices higher, Lim said.

Strategy, formerly known as MicroStrategy, filed Thursday to sell up to $2.1 billion of 10% perpetual strife preferred stock to fund purchases of even more Bitcoin.

An affiliate of Cantor Fitzgerald LP is working with stablecoin issuer Tether Holdings SA and SoftBank Group to launch Twenty One Capital Inc., a company that emulates Strategy’s business model. A subsidiary of Strive Enterprises Inc. co-founded by Vivek Ramaswamy is merging with Nasdaq-listed Asset Entities Inc. to form a Bitcoin treasury company.

“Unlike previous cycles, this rally is not momentum-driven alone,” said Julia Zhou, COO of crypto market maker Caladan. “It is quantitatively underpinned by measurable, persistent demand and supply dislocations.”

Bitcoin’s outperformance relative to smaller cryptocurrencies is widening. An index that tracks so-called altcoins is down about 40% year-to-date, while Bitcoin is up 18% so far in 2025.

A group of 12 US Bitcoin exchange-traded funds have drawn strong inflows, with investors pouring in about $4.2 billion so far in May. In options markets, traders built eye-catching Bitcoin positions earlier this week with the $110,000, $120,000 and $300,000 calls expiring on June 27 logging the most open interest — or number of outstanding contracts — on Deribit, the derivatives exchange.

Tony Sycamore, market analyst at IG, said in a note that the fresh record shows that Bitcoin’s steep decline from a previous high set on Jan. 20 to below $75,000 in April was “a correction within a bull market.”

“A sustained break above $110,000 is needed to trigger the next leg higher towards $125,000,” he added.

Source: Bloomberg

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Bond

Stocks

US stocks made little progress on Thursday as investors assessed the House's narrow vote to approve President Trump's "big, beautiful" tax bill and what it means for the growing US debt pile.

The Dow Jones Industrial Average (^DJI) was roughly flat. The S&P 500 (^GSPC) narrowly fell into negative territory on the day, sliding less than 0.1%, while the tech-heavy Nasdaq Composite (^IXIC) popped about 0.3%. All three indexes gave up solid gains in the final hours of trading.

The House of Representatives passed Trump's giant tax-and-spending package by a single vote after a last-gasp revision aimed at winning over conservative Republican holdouts. Changes including a more generous deduction for state and local taxes paved the way for the bill moving a step closer to becoming law.

Wall Street is worried that the legislation could add trillions to the existing $36 trillion deficit, especially after Moody's directly cited the proposal in downgrading the US credit rating.

Longer-dated bond yields, in high focus after a Moody's downgrade shined a spotlight on the US debt, eased after a steady march higher in recent days. The 30-year yield (^TYX) dipped slightly below 5.1% after it flirted with highs last seen during the financial crisis. The benchmark 10-year yield (^TNX) fell to around 4.55%.

Meanwhile, bitcoin (BTC-USD) continued to set fresh record highs, topping $111,000 for the first time as the leading cryptocurrency rose over 3% to $111,878. Ether (ETH-USD) also made gains amid growing institutional demand.

US economic output rebounded in May as businesses digested President Trump's tariff rollback. S&P Global's flash US composite PMI, which captures activity in both the services and manufacturing sectors, climbed to 52.1 in May, compared to 50.6 in April.

Meanwhile, in a sign of a softening US labor market, the weekly report on initial jobless claims released on Thursday showed the number of Americans filing for unemployment insurance on a continuing basis totaled 1.9 million, bringing the four-week moving average of continuing claims to its highest level since November 2021.

The rise in bond yields takes a breather

Longer-dated bond yields, in high focus after a Moody's downgrade shined a spotlight on the US debt, eased after a steady march higher in recent days. The 30-year Treasury yield (^TYX) dipped slightly below 5.1% after it flirted with highs last seen during the financial crisis. The benchmark 10-year Treasury yield (^TNX) fell to around 4.55%.

The 30-year Treasury yield had pressed above 5.1% to hit its highest level since 2007 earlier in the session.

Source: Yahoo Finance

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Energy

Commodity

U.S. crude oil storage demand has surged in recent weeks to levels similar to the COVID-19 pandemic, according to data from storage broker The Tank Tiger, as traders brace for a flood of increased supply in coming months from the Organization of the Petroleum Exporting Countries and its allies.

This month, OPEC+ agreed to accelerate oil output hikes for a second consecutive month in June as the group looks to punish over-producing members. OPEC leaders are also contemplating a similar increase in July, and could bring back as much as 2.2 million barrels-per-day (bpd) of supply to the market by November, Reuters reported earlier.

A secondary objective of the OPEC+ supply hikes is to win back market share from U.S. producers, who ramped up output to record levels in recent years while the OPEC+ was making deep supply cuts.

Brent crude futures slumped last month to a four-year low of $58.40 a barrel on fears the coming surge in OPEC+ supply could coincide with a global economic slowdown stemming from U.S. President Donald Trump's trade war.

Sliding prices sent a signal to traders to store oil until prices recover, especially as the market structure shows a glut of supply forming next year, said Steven Barsamian, chief operating officer at The Tank Tiger.

Crude oil storage demand on The Tank Tiger's platform has almost doubled from May to 3 million barrels for June, Barsamian said. Buyers have made inquiries for storage tanks across most U.S. trading hubs, including those in the country's Midwest and along its Gulf Coast.

"We have not seen this kind of an uptick in crude storage demand since the COVID-19 pandemic," Barsamian said.

New requests for June slowed over the past few weeks as the market recovered slightly on signs of progress in U.S. trade talks, but that only pushed the storage requests further out on the calendar.

Barsamian's team is now working on a request to find storage for crude oil next January at the Cushing, Oklahoma hub, an unusually long lead-time, he said.

"It shows how negative the market sentiment is if we are even getting a request that far out," he added.

U.S. crude oil inventories rose unexpectedly in the past two weeks and now stand at about 443.2 million barrels, the highest since July 2024, according to data from the U.S. Energy Information Administration. [EIA/S]

Source: Reuters

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Middle East Situation

Political

The United States would bear legal responsibility in the event of an Israeli attack on Iranian nuclear facilities, Foreign Minister Abbas Araqchi said on Thursday, following a CNN report that Israel might be preparing strikes on Iran.

Iran and the U.S., Israel's closest ally, will hold a fifth round of nuclear talks on Friday in Rome amid deep disagreement over uranium enrichment in Iran, which Washington says could lead to developing nuclear bombs. Iran denies such intent.

Citing intelligence sources, CNN said on Tuesday it was not clear whether Israel had made a final decision on military action and that U.S. officials disagreed about whether the Israelis would ultimately decide to attack.

“Iran strongly warns against any adventurism by the Zionist regime of Israel and will decisively respond to any threat or unlawful act by this regime,” Araqchi said in a letter addressed to United Nations Secretary-General Antonio Guterres.

Araqchi said Iran would view Washington as a “participant” in any such attack, and Tehran would have to adopt “special measures” to protect its nuclear sites and material if threats continued, and the International Atomic Energy Agency watchdog would be subsequently informed of such steps.

Although Araqchi did not specify what measures were being considered, an adviser to Iran's Supreme Leader said in April that Tehran could suspend cooperation with the IAEA or transfer enriched material to safe and undisclosed locations.

In a separate statement released on Thursday, Iran’s elite Revolutionary Guards warned Israel would receive a "devastating and decisive response" if it attacks Iran.

"They are trying to frighten us with war but are miscalculating as they are unaware of the powerful popular and military support the Islamic Republic can muster in war conditions," Guards spokesperson Alimohammad Naini said.

A collapse of U.S.-Iran negotiations or a new nuclear deal that does not alleviate Israeli concerns about Iran developing nuclear weapons through enrichment could motivate Israeli strikes on its regional arch-foe, diplomats say.

Later on Thursday, Araqchi said in a televised interview that if the United States aims to end uranium enrichment then there will be no nuclear deal.

"They have said [U.S. officials]... that they do not believe in enrichment in Iran... and it has to stop completely, if this is their goal there will be no deal", Araqchi said in the interview carried by state TV.

The Iranian foreign minister said the idea of a uranium enrichment consortium with the participation of other nations is not bad, but will not replace enrichment on Iranian soil.

On Tuesday, Iranian Supreme Leader Ayatollah Ali Khamenei said U.S. demands that Tehran stop refining uranium were "excessive and outrageous," and he voiced doubt over whether talks on a new nuclear deal would succeed.

Tehran maintains its nuclear energy programme is exclusively for civilian purposes.

Iran has the capability to build a nuclear weapon, but does not have the will to do so, Araqchi said.

Iran and Israel engaged in direct exchanges of fire last year, in April and October, raising the risk of regional conflict.

Source: Reuters

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Central Bank

Stocks

A Federal Reserve Bank of New York official responsible for implementing monetary policy said on Thursday the central bank is encouraging usage of a key liquidity tool that thus far has been largely dormant.

When it comes to the Standing Repo Facility, or SRF, "I encourage our counterparties to use the SRF when it makes economic sense - the facility is there to support the effective implementation of monetary policy and smooth market functioning," said Roberto Perli, who manages the central bank’s System Open Market Account, in the text of a speech prepared for delivery at a conference held by his bank. "It's in everyone’s best interest if the SRF works as intended," Perli said.

The Fed's SRF was launched in 2021 and provides eligible firms with fast cash in exchange for Treasury securities, in a bid to bolster market liquidity and avoid unexpected shortfalls that can be hard for the central bank to counter expeditiously. Thus far, markets, still flush with liquidity, have largely left the SRF alone outside of the end of the third quarter last year, a short period of volatility.

Perli reiterated in his remarks that fairly soon the New York Fed will join its afternoon SRF operations with a morning availability.

"In the not-too distant future," the New York Fed "will start implementing daily morning SRF operations that will also be settled in the morning," Perli said. "This will be an important step in enhancing the efficacy of the facility, and, at the margin, it can contribute" to allowing the Fed's balance sheet to be smaller than it would otherwise be.

Perli is responsible for implementing monetary policy for the central bank, both in terms of the management of its short-term interest rate target and its massive holdings of cash and bonds. Perli noted in his remarks that the ongoing contraction of the Fed's balance sheet, which has seen the central bank shed just over $2 trillion in Treasury and mortgage bonds, likely has some ways to go, although there are signs of tightening money market liquidity.

As Fed holdings shrink and reserve levels move down, "upward pressure on money market rates is likely to increase," Perli said, adding "we are starting to see the early signs of this in the repo market, especially around key reporting dates."

This rise in repo market chop "is not a cause for concern," Perli said. But he also noted that it’s likely to increase the need for markets to use the SRF to manage their liquidity needs.

Source: Reuters

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Bond

Economic

President Donald Trump cut a deal with blue-state Republicans on taxes and put down an 11th-hour rebellion by conservatives over spending to get his “one big, beautiful bill” passed by the House.

But if he’s going to shepherd the signature legislative package of his second term through the Senate, he may have to reckon with an even more demanding constituency: customers for the ballooning amount of US debt.

With the yield on 30-year Treasury bonds again passing the 5% mark on Wednesday, the nation’s creditors injected a dose of harsh economic reality into Trump’s fiscal policy — and not for the first time. Last week, a third bond-rating provider lowered the US sovereign grade, projecting the nation’s debt surging to 134% of the size of the economy in 10 years, from roughly 100% today.

That’s a long way from the vision Trump offered in his March address to Congress, when he promised a balanced budget “in the near future.” The House bill features a bevy of new tax breaks for key political constituencies — tipped and hourly workers, car buyers and seniors. And indications from GOP senators suggest they’ll seek to pare back spending cuts to shield others from financial pain.

Trump’s lieutenants, including Treasury Secretary Scott Bessent, argue that the package will boost business sentiment and unlock spending and investment. Trump’s allies on Capitol Hill also see it as the centerpiece of the party’s legislative agenda, and a counterweight to the uncertainty prompted by Trump’s haphazard tariff policies.

Bond market participants see something else.

“People are getting fed up. It’s clear that there are no adults in the room in Washington. Zero. No accountability,” said John Fath, managing partner at BTG Pactual Asset Management US LLC. “You have to ask yourself, what is it going to take? It’s going to be the price action.”

The action has been notable already. As Trump was putting pressure on House members to back the tax bill, the Treasury on Wednesday found tepid demand at an auction of 20-year bonds. Not just Treasuries, but stocks, too, tumbled as investor concern over the US fiscal profile deepened.

The moves were reminiscent of Trump’s wrangle with the bond markets last month, when he blinked. In the early morning hours of April 9, Treasury yields surged as Trump’s steep retaliatory tariffs — the highest in more than a century — went into effect. While a months-long slump in equities barely fazed him, the bond market got his attention.

“The bond market is very tricky,” he said at the time, announcing that he was suspending most of the tariffs just hours after they went into effect. “But yeah, I saw it last night where people were getting a little queasy.”

Interest Bill

If Treasuries continue to stay queasy, the higher yields not only threaten to dampen economic growth — as they translate into higher borrowing costs for everything from homes to cars — but to accelerate the government’s fiscal deterioration. As rates rise, so does the Treasury’s interest bill.

“Investors are now asking themselves a very difficult question, which is, would you loan the US government money at 5% for 30 years?” said George Catrambone, head of fixed income and trading at DWS Americas. “That’s the question that we have and are facing the long end of the Treasury market.”

Unlike in April, Trump has not had Bessent — who has been speaking to investors in Saudi Arabia and meeting with Group of Seven Finance Ministers in Canada — hovering over his shoulder as he negotiated the House’s tax bill in the Oval Office. It was Bessent, a hedge fund veteran, who helped persuade Trump to pause the tariffs when bond markets sent distress signals.

Bessent last month played down the selloff in Treasuries as a function of deleveraging by some market participants. In Banff, Canada, for meetings with Group of Seven partners, as of Thursday morning he had not weighed in on the most recent market volatility.

Friday’s removal of the US from the ranks of Aaa issuers by Moody’s Investors Service renewed market participants’ focus on the fiscal deficit — which has exceeded 6% of gross domestic product the past two years, unprecedented in the modern era for a time outside of recession or war. S&P Global Ratings took that step in 2011, and Fitch Ratings did so in 2023.

Moody’s said American economic strengths could “no longer fully counterbalance the decline in fiscal metrics.”

Even before the latest tax bill, which economists anticipate will deepen the deficit, the nonpartisan Congressional Budget Office projected that the US will see a record debt-to-GDP ratio by 2029.

“I do not know how much more of a wake-up call we need to get our house in order,” Ralph Norman, a South Carolina Republican, told Bloomberg Television Wednesday. “So all we are asking for is you need to pay for any expense you have.”

One of those expenses: The increase in the cap on state and local tax deductions. Set at $10,000 in Trump’s 2017 tax law, Republicans from high-tax states like New York and California negotiated an increase to $40,000 as the price of their votes for the package.

But it was a 12-basis-point increase in 30-year Treasury yields Wednesday that seems to have provided the impetus for further spending cuts to make the bill palatable to Republican hard-liners.

“The bond market seems to have spoken,” said Representative Warren Davidson of Ohio, one of two Republicans to vote ‘no’ on the bill.

Tush Push

As the bond markets started to show unease this week, Trump redoubled his efforts to get the measure — formally named the One Big Beautiful Bill Act — passed in the House. He visited Capitol Hill, called lawmakers and invited holdouts to the White House.

With the Memorial Day holiday weekend coming up, Republicans felt an urgency to get a legislative win in a presidency characterized by a blizzard of executive orders.

“The bill has to be done as early as possible both because the American people deserve the money in their pockets and the changes in their lives, but it also needs to happen soon, so it can have the biggest impact,” said former House Speaker Newt Gingrich, a close Trump ally. “If we are in the middle of a Trump economic boom in 2026, we will keep the House.”

If Republicans fail to pass the tax package, just as tariffs create a drag on the economy, then voters could revolt in the midterms. “In 2026, the only question that will matter is: Is it working?” Gingrich added.

But there’s no guarantee that the uneasy truce among the party’s various factions will remain intact when the bill gets to the other side of the Capitol.

Senate Majority Leader John Thune — who will lead the effort to shepherd the bill through his chamber starting in June — called the ratings agency downgrades “a warning shot that we need to get serious about spending restraint.” He said this week that any final bill would need to make a meaningful dent in spending, but also boost faster economic growth. Trumps Next Hurdle: The Bond Market Hates his "Beautiful" Tax Bill_1

Trumps Next Hurdle: The Bond Market Hates his "Beautiful" Tax Bill_1

Source: Bloomberg

To stay updated on all economic events of today, please check out our Economic calendar

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Cryptocurrency

Stocks

Kraken is preparing to roll out a new product that will allow users in select countries outside the US to trade tokenized versions of major American stocks and ETFs 24/7.

According to the May 22 announcement, the offering will include names such as Apple, Tesla, and Nvidia, with plans to expand the selection over time.

The announcement comes a few weeks after the exchange acquired NinjaTrader in February and subsequent expansion into stock trading last month.

xStocks

The product, dubbed xStocks, is built in partnership with Backed and will tokenize popular US-listed assets as SPL tokens on the Solana (SOL) network.

Unlike conventional equity markets, xStocks will be tradable 24/7 through Kraken’s platform and compatible Solana wallets.

The structure also allows the tokenized assets to be used onchain, such as for collateral in decentralized applications, use cases not possible through traditional brokerage systems.

Kraken’s Global Head of Consumer Mark Greenberg said that xStocks aims to offer faster, cheaper, and more inclusive access to US equities. He also criticized the current systems as slow, expensive, and geographically limited.

According to Greenberg: “[xStocks] is what the future of investing looks like.”

Democratizing access to US markets

Kraken’s move builds on its recent rollout of a conventional equities trading service for US-based clients, which includes over 11,000 publicly listed stocks and ETFs.

The company intends to expand the service to the UK, Europe, and Australia, while xStocks represents a parallel expansion using blockchain rails.

The launch comes amid heightened interest in tokenized real-world assets (RWAs), driven by demand for open financial infrastructure and the efficiencies introduced by digital rails.

Kraken has not announced a specific launch date for xStocks, but said it intends to grow the list of supported jurisdictions and tokenized assets over time.