Crypto Momentum Builds on Policy Support & Institutional Interest

Key Takeaways

• BTC & ETH ETF inflows persist despite slowdown; large corporate buys continue
• Trump’s 401(k) order may provide additional future demand for digital assets
• BTC near ATHs; targets $140K–$160K; MVRV at 2.6 signals more upside potential

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Digital Asset Commentary

Bitcoin & Ethereum ETF inflows have continued in recent weeks, though growth has slowed notably since August. This comes amid record US debt and deficits, now at $37 trillion, and a potential shakeup at the Federal Reserve that could shift voting members toward a more dovish stance. Corporate treasuries are also adding to digital asset holdings, providing price support for BTC & ETH. BitMine Immersion (BMNR) now holds over 1.15 million ETH, while Sharplink (SBET) plans to purchase more ETH after recently raising $900 million.

Also adding to more flows into crypto was an executive order signed by President Trump last week directing regulators to expand 401(k) access to alternative assets, including private equity, real estate, and digital assets, citing competitive returns and diversification benefits. BlackRock has suggested that investors with appropriate risk tolerance allocate up to 2% of their portfolios to BTC, while financial advisor Ric Edelman recently proposed a 10–40% allocation to cryptocurrencies and related businesses. Historical data shows that adding BTC to a traditional 60/40 portfolio, with annual rebalancing, has delivered outsized returns with only a minimal increase in drawdowns and volatility.

BTC and ETH extended their bullish momentum over the weekend, with BTC once again approaching all-time highs. Technical analysis points to potential further gains, with the next target range projected at $140K–$160K. On-chain BTC data also supports the potential for continued bullish momentum. The MVRV ratio, market capitalization versus realized value (based on the last transaction price of each coin), currently sits at 2.6. Historically, readings above 6.0 have coincided with market cycle tops, suggesting the current level leaves room for further appreciation in this bullish cycle.