BTC led a euphoric surge overnight, rallying from $107K to above $110K, as US-China trade talks resumed in London. The move was initially driven by optimism following headlines suggesting progress, though market enthusiasm quickly waned. Despite vague affirmations from US officials, with terms like “fruitful” and “good meeting” dominating the post-talks rhetoric, the absence of substantive breakthroughs saw global risk assets pause.

For now, markets remain in limbo. With US CPI data scheduled for release tomorrow, investors are treading cautiously. The risk is that continued diplomatic ambiguity morphs into a headwind for broader risk sentiment. Notably, a cryptic social media commentary by CCTV stoked speculation that the talks were less constructive than portrayed. This was reflected in gold’s intraday rebound and a striking 26% rally in China Rare Earth Holdings, reinforcing the sector’s role as a persistent geopolitical lever.

Ethereum Steps into the Spotlight

As BTC responds to macro-political theatre, ETH is quietly reclaiming narrative dominance.

Implied volatility on Ethereum has climbed, with front-end at-the-money vols pushing into the low 70s, while options skew flipped sharply in favour of calls, rising by 5 to 6 points. Elevated perpetual funding rates reinforce the bullish tone.

ETF flows are further validating this sentiment shift. ETH logged $281 million in inflows last week, with another $52.7 million added yesterday, pointing to renewed institutional interest. This rotation suggests a broadening thesis, from Bitcoin as digital gold to Ethereum as the infrastructure layer for real-world assets.

Looking ahead, macro tailwinds are aligning for ETH. With the GENIUS Act advancing in the US Senate, Circle’s IPO discussions resurfacing, and stablecoins gaining regulatory traction, Ethereum’s native role in tokenization and settlement rails may be primed for outsized structural upside.