In markets
Bitcoin took a tumble on Monday, with A$785M/US$563M in long positions liquidated in 24 hours. It was the biggest one-day wipeout since February. CryptoQuant drew a parallel to the early 2022 bear-market rally, when Bitcoin rallied 43% to hit the 200-day moving average before resuming its downward trend. They believe the traders’ on-chain realised price of A$100K/US$70K will serve as the primary support level.
The Iran conflict has been pushing up inflation and oil prices, and the US 30-year bond yield is paying 5.13% for the first time since 2007 (and it’s even higher in Australia). Higher risk-free returns make riskier assets worth less in present-day terms. It will be interesting to see how the new pro-crypto Federal Reserve chair, Kevin Warsh, responds to the situation.
Bitcoin finishes the week down 5.7% to trade around A$107,236 (US$76,614) while Ethereum dropped 8.3% to trade around A$2,971 (US$2,123). XRP fell 6%, Solana erased 12.2%, Dogecoin was down 6.3%, and Cardano lost another 9.8% to trade back at 2023 prices.
The Crypto Fear and Greed Index is at 25, or Extreme Fear. Putting the Bitcoin price into perspective, however, it was only 16 years ago this week that Laszlo Hanyecz sold two pizzas for 10,000 Bitcoin each. Today, Bitcoin’s market cap is $1.54 trillion, the Clarity Act has a good chance of passing, and US regulators and the government are going all in on digital assets.
From the OTC desk
Is Strategy About to Sell Bitcoin for the First Time?
Strategy has announced plans to repurchase US$1.5B worth of debt at a discount, effectively retiring the obligations at roughly 92 cents on the dollar. In a recent disclosure, the company listed bitcoin sales as a potential funding source, marking the first time Strategy has signalled any selling interest. While notable, this is better read as a disciplined approach to capital management rather than a shift in conviction. CEO Michael Saylor has committed to net accumulation, pledging to buy 10 to 20 coins for every coin sold, reinforcing the view that any disposals would be tactical rather than a strategic retreat. Strategy remains the largest institutional bitcoin holder, with 818,869 BTC, surpassing even BlackRock’s ETF. That said, markets will be watching closely for any trickle-down selling pressure across other digital asset treasury (DAT) companies, and the move may attract opportunistic short interest from bears looking to capitalise on any sell-off.
Macro Puts the Brakes on Bitcoin’s Breakout
Just as BTC/USD bulls appeared to be catching a break, macroeconomic concerns have begun to slow the rally. Bitcoin struggled to break above US$82,000 over the week despite progress on the Clarity Act, and prices have since pulled back below US$77,000. Heightened geopolitical tensions between the US and Iran, with no imminent resolution in sight, have added to market unease, with participants increasingly concerned about oil-driven inflation. Bond yields have spiked as investors grapple with rising liquidity fears: Japanese 10Y yields have surged to their highest level in two decades at 2.7%, while Eurozone 10-year bond yields climbed to 3.18%, their highest in 15 years. Perpetual futures funding has flipped to zero or negative, pointing to a significant deleveraging event that, historically, can lay the groundwork for a healthier, more sustainable move higher. Adding to near-term pressure, Harvard’s endowment fund cut its bitcoin position by 43% in Q1 2026 and fully exited its Ethereum holdings, further weighing on institutional sentiment. The IBIT ETF is consequently no longer Harvard’s largest disclosed public equity holding.
OTC desk activity
- The desk sees mostly sell flows as investors look to reduce risk
- Starting to see increased stablecoin selling despite Tether trading at a discount
Key Economic Calendar Events (AEST)
- Tuesday, May 19 2026 – 04:00 PM – GB Unemployment Rate (Consensus 4.9%)
- Wednesday, May 20 2026 – 04:00 PM – GB Inflation Rate YoY (Consensus 3%)
- Thursday, May 21 2026 – 04:00 AM – US FOMC Minutes
- Thursday, May 21 2026 – 09:50 AM – JP Balance of Trade (Consensus ¥-29.7B)
- Friday, May 22 2026 – 09:30 AM – JP Inflation Rate YoY (Forecast 2.0%)
- Friday, May 22 2026 – 04:00 PM – GB Retail Sales MoM (Consensus -0.4%)
In headlines
Getting some Clarity
The Senate Banking Committee has voted 15-9 to advance the crypto market structure bill, the Clarity Act (this version no longer features a tortured acronym). The bill got the votes of two Democratic Senators, Ruben Gallego and Angela Alsobrooks. More than 100 amendments were filed, and negotiations centred on the inclusion of ethics provisions to prevent elected officials from profiting from crypto (cough: Trump). Gallego said he would not vote for the bill in the actual Senate if they could not reach “agreement on ethics guardrails.” Protections for decentralised blockchain developers were also jettisoned to get the bill passed out of committee. The full Senate vote could be held sometime between June and August, and Polymarket odds of Clarity passing this year are at 64%.
Tokenised stock rules in the US this week
The SEC is set to release its “innovation exemption” for tokenised stocks this week. It is reportedly leaning toward permitting third-party stock tokens that don’t have the backing or consent of the companies whose shares they track.
Iran’s insurance plan
Iran’s Economy Ministry has proposed creating “cryptographically verifiable insurance policies… for shipments passing through the Persian Gulf, the Strait of Hormuz, and the surrounding waterways, and payments will be settled in Bitcoin.” According to state media Fars News Agency, the government believes it could generate US$10 billion (A$13.95B) a year. While Bitcoin can’t be censored, it can be traced, and any company caught transacting with Iran could face US sanctions.
Bank of England softens crypto stance
The Bank of England is reportedly backing away from its proposal to restrict individuals from holding more than 20,000 pounds in stablecoins. It’s also reconsidering its requirement that stablecoin issuers hold 40% of their reserves in zero-yield central bank accounts. The BoE has also proposed extending the operating hours of its core settlement infrastructure toward near-24/7 availability to prepare UK wholesale markets for tokenised finance.
Capital gains on crypto
Around 2,200 Bitcoiners have so far used the Australian Bitcoin Industry Body’s email tool to complain to MPs about the changes to capital gains taxes announced in the budget. Australian Financial Review columnist Christopher Joyce published a table comparing the old and new tax rates on a $10,000 Bitcoin investment held for 6 years and sold for $92,000. Under the old system, taxes could range from $0 to $19,364, depending on your tax bracket. Under the new system, hodlers will be taxed a minimum of $23,910 and a maximum of $37,459. Analyst James Check (Checkmatey) notes that existing holders are partially grandfathered but will have to pay the new tax rates on any gains made after mid-2027, meaning: “If Bitcoin has a bad month leading into that date, it can significantly increase our tax rate on the road ahead.”
Harvard and Jane Street’s portfolio changes
Harvard University has reduced its holdings in BlackRock’s Bitcoin ETF, IBIT, by 43% from the previous quarter. It now accounts for 6.44% of its portfolio. It also fully exited its US$87 million (A$121M) ETH ETF position. Meanwhile, Jane Street has been exiting Bitcoin ETFs and Strategy holdings, reducing its exposure by US$800 million (A$1.1B). At the same time, it increased its exposure to ETH ETs by US$82 million (A$114M).
Bits and pieces
The Washington Post reports that more than 20% of Trump Administration officials have crypto holdings ranging from small investments up to US$122M (A$170M). Ethereum Foundation contributors Carl Beek and Julian Ma have announced their departures from the organisation. So far this year, six other high-profile EF employees have left, including executive director Tomasz K Stanzak. ETH creator Vitalik Buterin has posted a blog suggesting that, while AI hacks are pummeling DeFi, he’s very hopeful that AI will lead to formally verified smart contracts that make DeFi much more secure. A Politico survey of 2,035 US adults found that just 18% considered establishing rules for the crypto market to be a top priority for Congress. Binance Research says that advances in anti-money laundering protections mean that around US$75 billion (A$105B) in illicit cryptocurrency is stranded on chain and unable to be laundered.
Asia Crypto News
Vietnam’s Deputy Finance Minister Nguyen Duc Chi says the first official activity in its newly regulated crypto market could kick off in the third quarter. Vietnam is considering a 0.1% tax on each transaction processed by a licensed provider. Myanmar’s Anti-Online Fraud Bill proposes severe penalties, including the death penalty, for those involved in crypto scam centres. South Korea’s Financial Services Commission (FSC) plans to release detailed tokenised securities rules in July. CertiK says North Korea-linked hackers stole about 60% of the value lost to crypto hacks in 2025.
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