Under the new highs of BTC and ETH's surge, COIN in US stocks also saw a significant rally.
Written by: 1912212.eth, Foresight News
The crypto market has recently experienced a major rebound, with BTC breaking through $123,000 to reach a historic high, and Ethereum achieving a four-week consecutive rise, successfully breaking through $3,600. Market participant sentiment has significantly recovered, with total market value soaring to a historic high of $3.8 trillion. Meanwhile, the intersection of the crypto market and US stock market is also experiencing a notable rebound.
Coinbase Global (COIN) stock reached a high of $415.96 this week, now just a step away from its historical high of $429, compared to its lowest point of $142 three months ago. As the world's largest crypto exchange, Coinbase's 2024 revenue has doubled to $6.6 billion. Although Q1 showed a significant decline, the potential recovery of crypto market in Q2 may improve its revenue performance.
US stocks and crypto exchange Robinhood also hit their historical high of $106.64, rising over 3 times from the April low of $30.
Strategy (MSTR), known as the "shadow stock" of Bitcoin, reached $442, with its market value rising to $126.8 billion, a historic high. In March, its bottom was only $231, an increase of nearly 100%. Strategy is now among the top 100 US listed companies by market value, compared to less than $2 billion five years ago. As of July 13, Strategy holds 601,550 BTC, with a total value of about $72 billion, at an average cost of $66,384. MSTR stock price has risen accordingly.
Other mining stocks like Marathon Digital (MARA) and Riot Platforms (RIOT) have risen 5%-10% this week, stimulated by Bitcoin's new high. Tesla (TSLA), though not a pure crypto stock, has its stock price indirectly boosted by its Bitcoin reserves (about 10,000), accumulating a rise of about 20% in 2025.
With the crypto market's significant rise, what positive factors are brewing behind the US stocks' rapid ascent in the crypto space?
Trump to Allow Retirement Funds to Invest in Crypto and Gold
The Financial Times reported that Trump is preparing to open cryptocurrencies, gold, and private equity to the $9 trillion US retirement market, which will stimulate a fundamental change in Americans' savings management. According to three informed sources, Trump is expected to sign an executive order as early as this week, opening 401k retirement plans to alternative investments beyond traditional stocks and bonds. These investments will cover a wide range of asset classes, from digital assets to metals, and funds focusing on corporate acquisitions, private loans, and infrastructure transactions.
The motivation behind this change is to stimulate economic growth and innovation. The Trump administration believes that traditional retirement investments have low returns (average 5-7% annually), while assets like crypto have performed strongly in the past decade. The biggest benefit of this policy is fund injection and market legitimization. First, even 1-2% allocation to crypto from the $9 trillion retirement market could bring in billions of new funds. Second, the policy will accelerate institutional adoption and mainstreaming of crypto. Retirement funds are long-term holders, and their entry will reduce market volatility and provide more stable liquidity.
This will directly boost the prices of mainstream cryptocurrencies like Bitcoin, Ethereum, and XRP. Historical data shows that similar institutional fund inflows (such as Bitcoin ETF approval) have caused BTC prices to rise over 30% in the short term. This incremental capital will amplify the bull market effect, push Bitcoin prices higher, and stimulate the return of the Altcoin season.
Expectations of Fed Rate Cuts in the Second Half of the Year
This was already reflected in the Federal Reserve's latest economic forecast in June. At the time, out of 19 officials, 10 predicted at least two rate cuts by the end of the year, while 7 believed there would be no rate cuts until 2025, reflecting different internal views on inflation prospects.
(Fed June SEP Dot Plot)
This divergence directly affects market policy expectations. Polymarket data shows that the probability of a 50 basis point rate cut this year is only 35%, while the probability of no rate cut has risen to 18%, reflecting the market's increasingly pessimistic expectations about rate cuts.
Despite recent hawkish statements from several officials, investors have not completely abandoned hope for rate cuts. The market believes the Fed is slightly more likely than 50% to decide on a rate cut at the September policy meeting. According to CME "Fed Watch" data, the probability of a 25 basis point rate cut in July is 4.7%, with a 95.3% chance of maintaining current rates. The probability of the Fed maintaining rates until September is 33.9%, with a 63.1% chance of a cumulative 25 basis point cut, and a 3% chance of a 50 basis point cut.
Fed's Daley stated that two rate cuts this year is a reasonable expectation. Trump has also continuously expressed dissatisfaction with Powell on social media, applying pressure for rate cuts.
As the Fed's rate cut expectations are about to be confirmed, risk assets will be preparing for an even larger wave of increases.
