After a brutal 8 week streak of unrelenting capital flight, the crypto ETF market just finally flashed a green light spot Bitcoin as well as ETFs just snap their losing streaks combining for roughly $282 million in net weekly inflows.
But before anyone celebrates that rebound recovers a mere 3% of the billions that drained out over the last few months.
And so are we witnessing a genuine institutional trend reversal or just.
A temporary breather in a macro driven bear market.
This does come as Bitcoin and are pulling back by about 2% this morning.
And joining us to weigh in is Adrian Fritz is chief investment strategist at 21 shares.
Adrian, good morning.
Thank you so much for joining us while we did snap in 8 week losing streak on Bitcoin and ETF.
So what is behind that reversal and given the price action this morning, do you think it's too early to call a market bottom.
Yes, I would say it's still too early to call it a bottom or even a trend reversal.
We're clearly still in a macro bear trend.
Um, however, we're going into a historically very exciting phase of, of the cycle, uh, and obviously just historically speaking, 1 year after the all-time high or usually 2 2.5 years after the prior halving.
We're moving into a bottoming zone.
Um, and I think, yeah, some investors are aware of that.
Um, it doesn't exclude, uh, further volatility throughout the summer, but I think, um, just if, if the story repeats, uh, it's getting more and more interesting to start building a position uh in Bitcoin.
And when we take a step back, as you mentioned, and we look at the Bitcoin chart, it is down nearly 50% from its peak and year to date.
Bitcoin is off a little over 28%.
But given what we're seeing in terms of accumulation and supply, can you give us your take on why you think it's not a systemic collapse right now?
Um, it's not just looking at ETF, uh, holdings, for instance.
Um, of course, in the US June has been quite a bad month, as you mentioned, we're seeing over 5/5 billion in, in outflows, but despite the price being down 50%, um, we've only seen a pullback in ETF Bitcoin holdings of around 10%.
So that clearly shows that some of those traditional investors, they hold through the volatility.
The market structure of Bitcoin has Certainly changed um and therefore I wouldn't call it a systemic breakdown because we don't haven't seen any kind of like major scandals, scams, something like FTX or Luna, a major collapse.
Um, it's really just a reset given the macro environment and also the cycle timing.
And speaking of which, while I have you here, Adrian, I do want to talk about derivatives in particular hyperliquids.
So the 21 shares hyperliquid ETF launch drawing in high early volume for that fund.
So tell us what's driving this appetite for derivative exposure in particular to hyperliquid.
Yeah, absolutely.
I think hyperliquid has definitely been the standout.
The spare market, um, obviously the token is up over 150% year to date.
Uh, I would say the reason being is that it's very much agnostic to where we're at in the cycle, um, or what's going on on a macro environment because investors just want to express their emotions and they do it via the derivatives market.
Um, of course, having access to derivatives 24/7, around the clock, around the globe, completely permissionless, is very enticing, um, and that's why we're seeing hyperliquid, yeah, at, at peak, making, uh, uh, multiple billion in trading volume, um, and I think that could be a story, uh, that continues.
And Adrian, I do want to move on to Solana.
So we are looking at Solana trading near $80 and it is down 2/3 from its peak, but also posting its busiest transaction month in history.
So can you explain what's happening below the surface and walk us through this decoupling between record on chain adoption and deflated asset prices.
Absolutely, um, we believe Solana has some strong fundamental traction right now.
Uh, of course, no one's paying attention.
Capital is clearly flowing, uh, to AI stocks right now.
Um, they're barely paying attention to Bitcoin, but if we dig deeper and just look at Solana, um, as you mentioned, that just hit an all-time high in regards to their, um, RWA volume.
Um, it climbed up to almost 3.5 billion, which is almost up 230% year over year.
Um, and it just recorded the largest week for tokenized equities.
Um, Yeah, over, over a billion in volume and capturing, yeah, almost 99% of the entire on-chain equity trading is definitely a standout.
Um, of course, prices are massively compressed, but on the fundamental side, we, we, we clearly see, uh, some traction and some structural trends that investors at least should pay attention to.
I do want to expand on this since you did mention that real world assets on Solana are jumping over 200% year over year.
But with the Alpenglow upgrade, do you think Solana is potentially overtaking Ethereum as the preferred institutional layer?
Uh, potentially, um, I think Solana always stood out in regards to their commercial efforts and initiatives, but they've been very good in striking like very high-level strategic integration and partnerships.
Um, it spans from Visa, Citi, uh, MoneyGram, Stripe, PayPal, and so on.
Um, and just given that the, the infrastructure is, uh, much cheaper, much faster.
Um, it could, it could really be the base for more institutional adoption going forward.
Um, we all know Ethereum had its struggle just because from an infrastructure point of view, it's much more complex.
We see a lot of fragmentation in regards to the layer two ecosystem, and I think that could be the opportunity to, for Solana to, yeah, potentially even flip, uh, Ethereum in the next cycle.
Who knows?
And very quickly before I let you go, Adrian, since we have kicked off the second half of 2026, give us your outlook as we head into your end.
Um, we, we, we believe, um, we're going into the pre-habbing narrative again, um, of course.
It, it, it kind of looks dire just looking at price charts, no one really paying attention, but that's usually where the opportunities are.
I mean, the value proposition of Bitcoin hasn't changed.
Um, the macro environment, we believe sooner or later we will see some rate cuts, uh, we will see some easing in regards to the inflationary pressure coming from the war, uh, and from oil, um, but just given if we put everything together, um, meaning, The next phase, the next cycle, macro tailwinds, hopefully some regulatory tailwinds, and just a narrative that builds momentum.
Um, we do believe that we could see a recovery, uh, yeah, up to 90, maybe even 1000 by the end of the year.
Well, Adrian, a lot to keep our eyes on as we head into the 2nd half.
So thank you so much for joining us today and thank you so much for sharing your perspective.
