Crypto-specific troubles
Crypto has also been fighting its own battles that may be capping the upside. To name a few: the $120 million Coldcard exploit, uncertainty around the Clarity Act, and reports of Strategy liquidating its BTC.
“Crypto has also faced its own pressures. The Coldcard exploit has damaged sentiment, while Strategy has sold bitcoin in three consecutive months. Neither event has triggered a broader credit event or forced liquidation cycle,” Haeems said.
He added that rising bond yields are creating an additional headwind for crypto, leading to an outflow of capital via stablecoins. Leading dollar-pegged stablecoin USDT's supply has dropped to its lowest since 2025.
“I would also watch stablecoin supply. USDT has fallen from about $190 billion in April to $183 billion, while USDC has declined from $79.5 billion to $72 billion. With real Treasury returns at their highest since 2008, capital is being paid to remain outside crypto,” Haeems added.
Halving cycle and ETF flows
There's also a four-year halving-cycle-related positioning story underneath all of this, and it may be the most counterintuitive piece.
According to Markus Thielen, founder of 10x Research, the lack of bullish impetus is likely the result of a self-fulfilling prophecy about the halving cycle's track record, which suggests a bottom may happen in October. Because most traders have come to believe this, they are simply sitting on the fence, awaiting October.