Macroeconomic and Policy Trend Analysis

Analysis of Trump's Policy Context

1. Inflation Reduction Path

• Promote peace between Russia and Ukraine, release Russian energy resources, and lower global energy prices
• The situation in the Middle East may lead to a short-term rise in oil prices, but it can be controlled through diplomatic means.
• Raising import tariffs may lead to a mild short-term economic recession and lower inflation.
• Pressure China with tariffs, engage in negotiations or implement economic blockade strategies

2. Interest Rate Path

• Pressuring the Federal Reserve to cut interest rates and expand its balance sheet to stimulate global liquidity
• Promote digital currency legislation, accelerate its development, and weaken the monetary control of the Federal Reserve.

3. Stimulating Economic Pathways

• Permanent tax reduction policy to increase disposable income for enterprises and individuals
• Implement differentiated tariffs on the manufacturing industry to protect domestic industries.
• Locking in a large amount of foreign investment through visits.
• Expand oil and natural gas extraction to increase energy export revenue
• Explore the expansion of the economic landscape, including acquiring other regions.

4. Path of Political Familism

• Accumulate family wealth through digital currency policies
• Consolidate the loyal team to ensure policy continuity

Summary of Policy Logic

The core of Trump's policy is economic stimulus, aimed at stimulating growth through lowering inflation, reducing interest rates, attracting investments, and energy development, while consolidating power and family interests through expansion and political means. The overall strategy is aggressive in the short term, with long-term effects dependent on diplomacy and policy implementation.

Neutral Interest Rate and Market Expectations

Market forecasts a 25 basis point rate cut on September 17, 2025, with two rate cuts throughout 2025 down to 4.00%, and a neutral interest rate rising to 3.50%. Currently, there is a game of chess between the Federal Reserve and the government over the early initiation of rate cuts. Trump's tariff policy is gradually showing its effects, bringing signs of economic slowdown. At the same time, the Federal Reserve has recently continued to reduce its holdings of U.S. Treasury bonds and tighten liquidity, leading to adjustments in the cryptocurrency market.

Important Economic Events and Data Focus

Next week, there will be multiple central bank speeches and policy statements, as well as key economic data releases, including employment reports and inflation data, all of which will have a significant impact on market trends.

On-chain Data Analysis

1. Short-term Market Influencing Factors

1.1 Stablecoin Fund Flow

This week's market trading volume has significantly decreased, down 76.4% compared to the previous period. The average daily issuance is only 0.78 billion, indicating a low liquidity state, suggesting that the market may enter a wait-and-see or fluctuation period. If the downturn continues next week, it will confirm that the market has entered a cooling phase.

1.2 ETF capital flow

This week, the ETF inflow decreased from 2.8 billion to 670 million, a reduction of 76%. The inflow rate is on par with previous lows, indicating that this wave of ETF trends has come to a temporary halt. After the decrease in ETF inflows, the price of Bitcoin has also pulled back, showing that the current price is highly dependent on ETF capital support.

1.3 Over-the-Counter Premium and Discount

In late May, the OTC premium for USDT and USDC remained around 100.0%, with very little fluctuation, reflecting a clear wait-and-see sentiment among funds and a slowdown in liquidity. Overall, the OTC stablecoin premium is at "zero premium" or "near discount," indicating a lack of motivation for new fiat currency to enter.

1.4 Institutional Investment Trends

The stock price performance of a well-known institutional investor has not met expectations, despite increasing its holdings in Bitcoin assets, but the stock price still has a premium relative to Bitcoin. This may indicate that the current investment enthusiasm might be about to peak.

1.5 Exchange Balance Change

The proportion of Bitcoin exchange balances continues to decline to a near one-year low of 15.046%, indicating a significant reduction in on-chain selling pressure. The proportion of Ethereum exchange balances, on the other hand, has increased from 13.52% to 15.83%, showing a certain level of selling pressure.

2. Factors Influencing the Mid-Term Market

2.1 Changes in Holding Address Distribution

The number of addresses holding 1,000 to 10,000 bitcoins saw a significant decline on the 26th and 27th of this week, indicating a short-term bearish signal. However, this portion of funds has mainly been absorbed by addresses holding 100 to 1,000 bitcoins, and the medium to long-term market structure has not changed significantly, with a relatively even distribution of chips.

Market Outlook

Based on a comprehensive analysis of various data, the market may continue to adjust next week, especially after Ethereum rises again. Investors should remain vigilant and pay attention to new market trends.