Original: galaxy
Compiled by: Yuliya, PANews
Bitcoin reached $112,000 this morning, setting a new historical record. This surge is the result of multiple factors, including a continuously weakening US dollar, abundant global liquidity, and accelerated institutional capital inflow. Galaxy wrote an article reviewing market dynamics since June, analyzing the impact of geopolitical conflicts and economic data on risk assets, and exploring Bitcoin's unique performance in this rally and its future direction. The following is the original article, compiled by PANews.
June Review
The market in June 2025 was overshadowed by trade uncertainty, geopolitical conflicts, and complex economic data. However, despite the challenging macro background, risk assets generally rebounded. US stock markets rose across the board, with the Nasdaq 100 and S&P 500 both hitting all-time highs. Bitcoin briefly dropped below $100,000 mid-month but subsequently staged a strong recovery, rising 2.84% for the month. In contrast, the overall crypto market declined 2.03%, with Ethereum experiencing higher volatility and underperforming other mainstream assets, recording a 2.41% drop.
[The rest of the translation follows the same professional and accurate approach, maintaining the original structure and meaning while translating to English.]Under regulatory push, corporate interest in stablecoins continues to heat up. US retail giants like Walmart and Target are considering issuing their own stablecoins; Mastercard is further expanding ecosystem support by integrating stablecoin products from Paxos, Fiserv, and PayPal. These companies are not only competing to issue stablecoins but also hoping to lead in circulation scale and actual usage. The industry focus has shifted from "whether they can be issued" to "whether they can be implemented", with stablecoin success depending on its penetration and user coverage in real payment scenarios.
Internationally, this trend is gradually spreading. For example, Ripple has obtained regulatory approval for its RLUSD stablecoin in Dubai, and the South Korean central bank is exploring issuing a won-pegged stablecoin. However, the US development remains the most advanced currently.
Stablecoins are just the starting point. They mark the first phase of introducing traditional fiat currency into blockchain, achieving round-the-clock, rapid interoperable infrastructure deployment. The next stage will focus on introducing on-chain financial assets, starting with stock tokenization.
Robinhood has recently launched tokenized trading for 200 listed stocks in Europe, becoming a pilot platform to test user demand and execution quality. Coinbase is also seeking corresponding regulatory permits in the US to promote similar product implementation. These early attempts pave the way for more traditional financial products to go on-chain, with the next step expected to cover asset classes like private credit and structured funds.
Geopolitical Conflict's Market Impact Limited
The Israel-Iran war that broke out on June 13, 2025, lasted 12 days. Although it drew global attention, its long-term impact on risk assets was limited. In the initial conflict, crypto and stock markets reacted moderately. However, after the US government launched the "Midnight Hammer Operation" on June 22, conducting airstrikes on Iranian nuclear facilities, crypto asset prices sharply dropped. As Trump announced a ceasefire agreement with Qatar on June 24, prices quickly rebounded. Although sporadic missile attacks continued by month-end and the war has not officially ended, the market has generally stabilized.
During this period, Bitcoin's trend synchronized with US stocks, not displaying safe-haven attributes. Compared to Bitcoin's performance in April and May as a value storage asset during trade tariffs and global bond market tensions, this time it leaned more towards risk asset logic. Bitcoin outperformed gold and the overall crypto market, partly due to strong institutional support, including monthly ETF inflows of $4 billion, continuous treasury company purchases, and emerging sovereign buying signals, indicating the geopolitical impact on Bitcoin was relatively short-lived.
This conflict also reignited market attention to Iran's local crypto infrastructure, especially Bitcoin mining. According to Elliptic's 2021 estimate, approximately 4.5% of global Bitcoin mining occurs in Iran, mainly relying on low-cost government-subsidized electricity settled in rial. During Bitcoin's rising cycle, this structure brings considerable profits.
After the US-Israeli airstrike, rumors suggested some Iranian mining sites were damaged, causing network hash rate decline. However, short-term hash rate fluctuations are more likely caused by block time differences or data noise, with no clear evidence currently showing systematic damage to mining facilities. Another possible explanation is the heatwave in the US East and Midwest forcing miners to temporarily reduce production.
Beyond infrastructure, this conflict sparked discussions about crypto's role in Iran's financial system. Historically, Iran's high inflation, international sanctions, and unstable dollar exchange rates have driven widespread crypto adoption in civilian and gray economies.
Previous Chainalysis data shows crypto asset outflows in Iran significantly increased during Hezbollah leader assassinations and multiple missile exchanges in 2024.
Bitcoin and TRON have traditionally been the primary blockchain networks used in Iran, especially TRON for USDT stablecoin transfers. However, in this conflict, on-chain stablecoin transaction and settlement volumes did not show significant increases, indicating no substantial change in overall crypto usage patterns, with short-term holders' on-chain activity even decreasing.
Although on-chain data showed no significant anomalies, the crypto industry symbolically emerged in this conflict: Iran's largest crypto exchange Nobitex suffered a $90 million hacker attack during the conflict, with attackers from the pro-Israel organization "Predatory Sparrow" leaving messages like "F*ckiRGCTerrorists" through wallet addresses. Nobitex's past associations with IRGC-related entity fund flows made this attack more like a cyber psychological warfare than a profit-driven assault.
Iran is one of the countries with the most severe currency devaluation and long-term sanctions. For such societies, crypto assets indeed play a crucial role in cross-border fund flows. The political and network dimensions demonstrated in this conflict further indicate that crypto has become part of some countries' financial systems.
July Key Variables Will Determine Macro and Market Trends
Entering July 2025, market focus will concentrate on several key events and macro indicators that could significantly impact asset pricing and overall environment.
Trump signed the "Big and Beautiful" bill on July 4th, which might substantially expand the already higher-than-expected fiscal deficit. According to the latest economic data, US fiscal expenditure continues to exceed income levels.
Inflation pressure remains a core consideration, but recent data shows inflation has somewhat eased. The core Personal Consumption Expenditures (PCE) index is trending downward, with only a single-month increase in February 2025, possibly mainly from tariff-related prior pricing pressures. Currently, inflation seems controlled, but the real risk lies in the Federal Reserve potentially reigniting price increases by cutting rates too early.
The labor market remains tight, providing the Federal Reserve more flexibility in decision-making. June job additions exceeded expectations, with unemployment dropping to 4.1%, lower than the most optimistic market predictions. This decline partly stems from labor participation rate dropping from 62.4% to 62.3%. Currently, market expectations for July rate cuts have dropped to zero, with overall yearly expectations at two rate cuts, depending on tariff and growth data trends.
Another trend to closely watch is the continued US dollar weakness. Economic uncertainty, unclear fiscal policies, and potential future rate cut expectations collectively drive dollar weakness. The Dollar Index (DXY) is heading towards its worst first half since 1973. As risk assets are dollar-denominated, dollar weakness helps explain the current stock market's resilience and Bitcoin's strong performance, despite complex fundamental data. Simultaneously, US M2 money supply is near historical highs, with market liquidity abundant. If the Federal Reserve turns accommodative in the second half, the dollar may face further pressure.
Key time points to focus on in July:
July 11: Consumer Price Index (CPI) release
July 16: Producer Price Index (PPI) and Federal Reserve Beige Book release
July 30: FOMC Rate Decision
Cryptocurrency Performance
