Market Shifts, Big Bets, and Decentralization Drama
Weekly Market Update #65
In partnership with Elementus
Happy start to the week! Welcome back to the Reflexivity Weekly Market Update — your concise rundown of the biggest moves in crypto. If someone forwarded this to you, you can sign up here for free to get it straight to your inbox!
Today’s Market Update is in partnership with Elementus. Delivering preeminent on-chain intelligence, Elementus provides macro and micro-level visibility for investment, compliance, and DeFi projects.
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Major Market Developments:
😨 Market Mood Swings to Fear: Crypto sentiment flipped as the Fear & Greed Index plunged (details below).
💰 Big Money Bets on Bitcoin: Bitcoin ETFs saw $196.4M inflows while Ethereum ETFs had $8.7M outflows – a clear tilt toward BTC.
🔦 Spotlight – Hyperliquid Faced Market Manipulation: A trader exploited $JELLY perp market, forcing liquidations and offloading nearly $13M in losses onto the protocol’s risk vault.
🏢 MicroStrategy Stacks $584M in BTC: Michael Saylor’s firm added 6,911 more Bitcoin, pushing its stash above 500,000 BTC.
🎮 GameStop Jumps on the Bitcoin Bandwagon: The gaming retailer plans to deploy part of its $4.8B cash into Bitcoin as a treasury reserve.
⚡ Plus: Rapid-fire news from BlackRock, Binance, Arbitrum, Circle, the UAE, and the SEC in our Quick Takes section.
Fear & Greed Index:
The Crypto Fear & Greed Index slumped into “Fear” territory this week with a reading around 26. That’s a big drop from the mid-40s just days ago, highlighting a sharp swing toward investor caution.
After a strong run that saw Bitcoin briefly trade near $88K, the market cooled off, and sentiment turned wary. In other words, the needle on the crypto sentiment gauge is now firmly pointing at Fear as traders react to recent volatility and macro jitters.
ETF Flows:
Despite this fear, Bitcoin ETF demand is back: Bitcoin-focused ETFs saw roughly $196.4 million in net inflows this week, a notable uptick as investors poured money into BTC exposure. Ethereum ETFs, meanwhile, bled about $8.7 million in net outflows, suggesting some investors are rotating out of ETH. The stark contrast in flows underscores a growing preference for Bitcoin – likely driven by its recent price strength and optimism around BTC investment vehicles. Bottom line: big money appears more eager to HODL Bitcoin right now, while Ethereum is taking a back seat in portfolios.
Spotlight 🔦
Last week, Hyperliquid faced its biggest test yet after a trader manipulated the JELLY perpetuals market, triggering a sharp price spike, liquidations, and nearly $13M in unrealized losses dumped on the protocol’s risk vault (HLP).
The attacker opened an oversized short, pumped JELLY on-chain, then forced a liquidation that left the vault holding the bag.
Hyperliquid responded quickly:
Froze attacker withdrawals
Halted the JELLY market
Settled all positions at the pre-manipulation price
Promised full reimbursements to impacted users
The platform avoided net loss, but the event exposed key weaknesses in risk controls and governance.
The platform avoided net loss, but the event exposed key weaknesses in risk controls and governance. The incident sparked debate about decentralisation vs intervention. Trust was shaken, but upgrades are now live. Hyperliquid’s next chapter will hinge on restoring credibility without sacrificing resilience.
Rapid Reflexivity: Quick Market Takes ⚡
MicroStrategy’s Bitcoin Binge: MicroStrategy bought 6,911 BTC (≈$584 million) last week, boosting its total holdings above 500,000 BTC.
GameStop to HODL BTC: In a bold pivot, GameStop announced plans to invest a portion of its $4.8 billion cash reserves into Bitcoin for its corporate treasury.
dYdX Launches Buybacks: Decentralized exchange dYdX introduced its first token buyback program, committing 25% of protocol fees to regularly repurchase $DYDX tokens from the open market.
BlackRock Debuts Bitcoin ETP: Asset management giant BlackRock rolled out its first European Bitcoin ETP on March 25, marking a key milestone for Bitcoin adoption in the EU. The iShares Bitcoin ETP offers European institutions a new avenue for BTC exposure.
Binance Boots Rogue Market Maker: Binance offboarded a market maker that allegedly dumped 66 million $MOVE tokens right after launch. The offending account netted ~$38M from the dump before Binance froze the profits and gave them the boot – a strong message against market manipulation.
Arbitrum Eyes Gaming Fund Cuts: The Arbitrum DAO is debating defunding its $200M Gaming Catalyst Program (225M ARB tokens). Community members argue the grant program isn’t delivering results and want to claw back funds to the treasury. The proposal highlights governance in action — and the push for accountability.
USDC Lands in Japan: Circle’s USDC stablecoin just went live in Japan via a partnership with SBI VC Trade, becoming the first major global stablecoin approved under Japan’s new crypto regulations. Japanese users can now access a domestic, regulated USD-backed stablecoin for the first time.
UAE Readies Digital Dirham: The UAE’s central bank announced plans to roll out a “Digital Dirham” CBDC for retail use by Q4 2025. The digital currency will complement cash, with integration into the UAE’s payment systems – part of the country’s push to embrace fintech and blockchain at a national level
SEC Clears Crypto.com: In regulatory relief, the U.S. SEC has officially closed its investigation into Crypto.com with no enforcement action. Seven months after issuing a Wells notice, the SEC decided not to pursue charges, effectively giving Crypto.com the all-clear. It’s a welcome win for the exchange and perhaps a sign of easing tensions between crypto firms and regulators (for now).
For the final update of this week we will take a quick glance at the best and worst performers.
Unsurprisingly, Crypto.com’s $CRO token came out on top last week following the settlement of its SEC case. This was in addition to the news that Trump’s media group is partnering with them to launch crypto-friendly “Made in America “ ETFs sometime in the near future.
$HYPE finds itself as one of the biggest losers of the week following the $JELLY fiasco, as discussed in detail in the Spotlight section of this update
Disclaimer: This research report is exactly that — a research report. It is not intended to serve as financial advice, nor should you blindly assume that any of the information is accurate without confirming through your own research. Bitcoin, cryptocurrencies, and other digital assets are incredibly risky, and nothing in this report should be considered an endorsement to buy or sell any asset. Never invest more than you are willing to lose, and understand the risk that you are taking. Do your own research. All information in this report is for educational purposes only and should not be the basis for any investment decisions that you make.