Rising diplomatic tensions involving Greenland added to market unease. At the same time, renewed threats of additional trade tariffs resurfaced. Shifting expectations around the future leadership of the US Federal Reserve further unsettled sentiment. Reports suggesting that Kevin Hassett would remain in his current role rather than move toward the Fed chair reshaped views on the policy outlook.

Bitcoin Carried the Market

According to CoinShares’ weekly Digital Asset Fund Flows report, the bulk of inflows was concentrated in Bitcoin. Bitcoin investment products recorded $1.55 billion in net inflows, clearly leading the market. Despite ongoing regulatory uncertainty and debate around the US Senate Banking Committee’s CLARITY Act, capital continued to move into major crypto assets.

Ethereum products attracted $496 million, while XRP-related products saw $69.5 million in inflows. Even as potential restrictions on yield-generating stablecoin structures were discussed, demand for core assets remained resilient. This suggests that investors are, for now, sidelining near-term regulatory risks.

Selective Buying Sharpened Altcoin Divergence

Altcoin flows painted a more selective picture. XRP-linked products stood out with $45.5 million in inflows. Sui added $5.7 million, followed by Lido with $3.7 million and Hedera with $2.6 million. Litecoin and Chainlink also posted modest gains of $2.3 million and $1.2 million, respectively.

In contrast, multi-asset investment products recorded $12.5 million in outflows. This pattern points to investors trimming complexity and favoring clearer, single-asset exposure as perceived risk increases.

Capital Concentrated in the US

Regionally, flows were heavily skewed toward the United States. US-based products attracted $2.05 billion, making it the clear center of gravity for the week. Germany followed with $63.9 million, while Switzerland recorded $41.6 million. Canada and the Netherlands also posted smaller but positive inflows.

Elsewhere, sentiment diverged. Sweden saw more than $4 million in outflows, while Brazil recorded withdrawals of around $1 million. The contrast highlights how regional risk perceptions are increasingly shaping global crypto allocation decisions.

Risk Appetite Back Under Pressure

Friday’s reversal is now being interpreted as part of a broader shift toward risk-off positioning. Mercury Co-Founder and CEO Petr Kozyakov noted that market optimism appeared fragile, likening conditions to “thin ice.” Bitcoin’s pullback toward the $93,000 level, combined with sharp selling during Asian trading hours, erased a significant portion of year-to-date gains.

Heavy liquidations across derivatives markets underscored how exposed positioning had become. As global equity markets also moved lower, investors rotated toward traditional safe havens such as gold and silver. Once again, crypto markets found themselves trading under the shadow of macroeconomic risk.

At this stage, the key question is no longer the size of recent inflows, but how much of that capital will remain in place. With geopolitical tensions and monetary policy expectations still unresolved, sustained confidence may prove difficult. In the days ahead, both flows — and the absence of them — are likely to carry equal weight.

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According to the White House, both nations agreed to lower their respective tariffs by 24%, bringing them down to 10%, starting May 14. Speaking at a press conference in Geneva, US Treasury Secretary Scott Bessent emphasized that neither side wants to pursue further economic decoupling.

Bitcoin Nears Record High as Risk Sentiment Improves

Aurelie Barthere, principal research analyst at crypto intelligence firm Nansen, noted that the easing of trade tensions removes the risk of a “sudden re-escalation,” making room for risk assets to catch up with Bitcoin’s gains.

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“Bitcoin is already trading within 4.8% of its all-time high of $109,800,” she said. “With this trade breakthrough, altcoins, US equities, and the Dollar Index (DXY) are now well-positioned for a rebound.”

Barthere also pointed out that Bitcoin has outperformed traditional risk assets recently due to its independence from tariff-related vulnerabilities.

Tax Cuts Could Fuel Second Wave of Rally

Another major catalyst may be on the horizon. Bessent hinted that a tax relief package could be unveiled by mid-July. According to Barthere, this package would need to go beyond extending expiring cuts — it must also include new income and corporate tax reductions to sustain the rally.

Paired with emerging bull flag patterns on the weekly chart, analysts are already forecasting a potential surge in Bitcoin price towards $150,000, should all elements align.

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