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Bitcoin and Ethereum face technical challenges, while stablecoin regulation may become a catalyst for growth.
Crypto Market Analysis: Bitcoin and Ethereum Technologies Face Challenges, Regulatory Progress May Become a Growth Catalyst
Market Overview
Recently, U.S. core inflation data has been below expectations for five consecutive months, but there are differing opinions in the market regarding future trends. Some viewpoints suggest that the impact of tariffs may become apparent in July and August, while others emphasize companies' pricing restraint amid weak demand. Within the Federal Reserve, there are also differing voices: the Chair has hinted at potentially lowering the threshold for interest rate cuts, while some regional Fed presidents prefer to maintain a tight policy. Currently, the Federal Reserve is more inclined to take a wait-and-see approach and emphasizes the importance of being wary of misleading short-term data.
In terms of regulation, the U.S. Congress has accelerated the legislative process by establishing "Crypto Currency Week." One important bill will implement regulations on the stablecoin market, requiring reserves to be held in cash and short-term U.S. Treasury bonds. This initiative not only standardizes the market but may also achieve dual strategic goals: first, to strengthen the digital hegemony of the dollar by supporting compliant stablecoins, and second, to create new demand for U.S. Treasury bonds. Furthermore, the global payment system may be restructured as several tech giants attempt to establish new cross-border settlement networks through stablecoins. Some analysts believe that this shift in regulatory paradigm will reinforce Bitcoin's position as a digital gold asset allocation.
Technical Analysis
Bitcoin has entered a correction phase after reaching a historical high. Several analysts are focusing on the technical repair of the CME futures gap, expecting the price may pull back to the range of $113,800 to $117,000 to fill the gap, after which it could usher in a new round of increases. There are views that if the price cannot quickly break through the current consolidation area, it may push Bitcoin back up to around $120,000. From a cyclical perspective, the current expansion has only been underway for 12 days, leaving room until the historical cycle of 15-30 days.
Ethereum's market capitalization share has surpassed 10%. Although its performance has been weaker than Bitcoin this year, the trends of stablecoins and tokenization are driving its demand growth. On the technical side, several analysts are also paying attention to the CME gap, believing that after filling the gap between $2,830 and $2,925, Ethereum is expected to break upward above $3,200. Research indicates that the increase in Ethereum's trading activity is correlated with enhanced linkage to small-cap stocks, providing rebound momentum under the expectation of liquidity easing.
In the altcoin market, there are viewpoints suggesting that 3-5 weeks after Bitcoin breaks a new high is usually the window for altcoin rallies, and the current cycle may last for 1-2 months. Market funds are showing obvious sector rotation: payment tokens are starting first, major coins are poised to take off, and some ecological projects and Layer1 projects are forming a relay team. In addition, Chinese concept tokens and AI-related projects have been active recently.
Key Data
Future Outlook
Recently, multiple projects will conduct token issuance or airdrop activities. The U.S. House of Representatives will hold hearings to discuss digital asset tax policies. Several projects will unlock tokens, among which Arbitrum, UXLINK, and Solv Protocol have larger unlock scales. The market is paying attention to the Federal Reserve's economic condition report and officials' speeches to assess the future direction of monetary policy.
Overall, the crypto market is in a critical period of technical adjustment and policy game. The price trends of Bitcoin and Ethereum will be affected by technical factors such as the CME gap, while the progress of regulatory policies may become a long-term market catalyst. Investors need to pay attention to the support levels and breakout situations of major coins, while closely tracking regulatory developments and macroeconomic data.