BTC Feels Geopolitical Tremors 📉
Digital gold narrative in question
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Welcome to Mempool - your weekly market and news insights on Bitcoin.
We're looking at Week 25 of 2025 (Jun 16-Jun 22)
Bitcoin records worst week in months on worsening war
ETF flows stay resilient while retail participation evaporates
Circle rockets on stablecoin legislation as treasury firms stumble
Hash rate hits four-month low amid rising mining costs
The Week That Was
Bitcoin endured its worst weekly performance in roughly three months, plummeting 4.32% to close at $100,987 as geopolitical tensions got worse in the Middle East. It slipped below the psychologically important $100,000 mark intraday for the first time since May 8, ending an 18-day streak above six figures.
The sell-off intensified following US President Donald Trump's announcement on Saturday night of coordinated US and Israeli airstrikes on three Iranian nuclear facilities under "Operation Midnight Hammer."
Bitcoin temporarily dropped below $99,000 on Sunday as traders fled to traditional safe havens, triggering over $1 billion in crypto liquidations within 24 hours.
The Crypto Greed Index plunged to 37 from 50 the previous week, marking a return to "fear" territory for the first time in two months. Iran's parliament threatened to close the Strait of Hormuz in retaliation, raising concerns about potential oil supply disruptions.
Bitcoin network fundamentals reflected the uncertainty, with hash rate slumping to a four-month low. The declining hash rate suggests mining profitability pressures as operational costs rise above $70,000 per BTC, potentially making the network temporarily more expensive to secure."
Open Interest declined for the fourth straight week as leveraged positions unwound amid the volatility. Bitcoin dominance rose to 64.9%, the highest since January 2021, despite the price decline, suggesting altcoins faced even steeper losses during the risk-off period.
ETF flows stayed positive and above the $1 billion mark for the week.
Price Chart Analysis
Bitcoin's weekly journey began with a steady rise above $106,000 as markets digested Federal Reserve Governor Christopher Waller's surprisingly dovish comments on Friday suggesting rate cuts could come "as early as July."
Bitcoin slid below $104,000 on Tuesday and traded in the range of $103,000-$106,000 for most part through Friday as it saw increased volatility amid escalating Middle East tensions.
The weekend brought a catastrophic breakdown as news of "Operation Midnight Hammer" hit markets. Bitcoin's violent Sunday plunge from about $103,000 to an intraday low near $98,000 demonstrated the cryptocurrency's continued sensitivity to geopolitical shocks, despite its "digital gold" narrative.
Bitcoin's correlation with traditional risk assets remained evident during this phase as it diverged sharply from gold during several key moments throughout the week. Gold initially rose on safe-haven demand during the Iran crisis as Bitcoin sold off aggressively, highlighting its persistent correlation with risk assets rather than traditional hedges.
This inverse relationship was particularly pronounced during Sunday's crisis, when gold spiked close to its all-time high above $3,430 while Bitcoin collapsed below $100,000.
The technical picture shows Bitcoin breaking below critical support at $103,000, a level that had held since early June. The breach of this zone, combined with the violation of the psychologically important $100,000 threshold, suggests further weakness may emerge if geopolitical tensions persist.
Key technical levels
Immediate support: Around $98,000-$99,000 (Sunday's lows)
Resistance at $103,000-$104,000 (previous support now turned resistance)
Bitcoin managed to climb above $102,000 late on Sunday night. The cryptocurrency's ability to reclaim and hold above $100,000 will be crucial for maintaining its bull market structure amid ongoing global uncertainties.
ETF Flows Defy Market Chaos
Despite Bitcoin's plunge through the week, institutional flows via ETFs remained resilient, recording $1.02 billion in weekly net inflows. BlackRock's IBIT has recorded nine consecutive days of positive flows, pulling in ~$640 million on Tuesday alone.
Spot Bitcoin ETFs now account for 25% of total Bitcoin trading volume globally, up from just 10% in October 2024, with Wall Street rapidly capturing market share from crypto-native exchanges. IBIT has emerged as the dominant force, controlling 54.7% of the US spot Bitcoin ETF market and nearing $70 billion in assets under management.
This institutional appetite persisted even as on-chain data revealed troubling signs for retail participation.
Bitcoin's short-term holder cohort fell by over 800,000 BTC since May 27, signalling that "new money is drying up" as fewer retail investors enter the market, a chart by CryptoQuant showed. High-value transactions now dominate network activity, with transfers exceeding $100,000 accounting for 89% of Bitcoin's transaction volume.
Crypto Stocks Face Mixed Reality
The new crypto entrant of Wall Street stole all the spotlight as Circle (CRCL) skyrocketed 80% following the Senate's passage of the GENIUS Act. The legislation's implications for stablecoin regulation sent Circle's shares from $149 to nearly $249.
Read: The GENIUS Stablecoin Play💸
Circle’s market cap stands at $56.2 billion, while the USD reserve it holds is $61 billion. Even at conservative estimates, the treasury could fetch $2.44 billion in revenue if Circle earns 4% on average. This pegs Circle’s current market value at ~19x its forward revenue, assuming the revenue grows to $3 billion.
In contrast, even with a modest year-on-year (YoY) growth in its revenue in 2025, Coinbase will have a price to sales (PS) multiple of less than 11x with $77 billion in market cap currently.
Meanwhile, Robinhood’s PS multiple is likely to be ~18x considering a 30% YoY jump in its revenue. That’d be a conservative growth estimate since Robinhood’s revenue has grown 50% YoY in 2024 and 2023.
Mining stocks struggled against rising operational costs and falling Bitcoin price.
Bitcoin treasury holders, Strategy (MSTR) and Marathon Digital (MARA), fell despite both the companies adding 10,100 and 168 Bitcoins to their stacks during the week.
The divergence between infrastructure plays and direct Bitcoin exposure companies became stark.
Robinhood (HOOD) also managed to close the week 8% up.
The Bitcoin Treasury Trap Tightens
The corporate Bitcoin treasury model faces its major stress test as valuations compress dangerously close to net asset values.
Semler Scientific saw its market-to-net-asset-value ratio plummet to just 1.05 this week, meaning investors value the entire company at barely more than its Bitcoin holdings alone.
This razor-thin premium has triggered red flags among analysts.
VanEck's Matthew Sigel warned that companies trading below 0.95x net asset value should immediately halt share issuances, as continued equity dilution becomes extractive rather than strategic.
The divergence between Michael Saylor’s Strategy and others following the Bitcoin treasury model is stark. Strategy maintains a comfortable cushion with its $70,000 average Bitcoin cost basis, while newer entrants face potential forced liquidations if their premiums evaporate completely.
The race to replicate Saylor's success may have created the very trap these companies sought to avoid. This is now forcing them to choose between diluting shareholders or abandoning their Bitcoin strategies entirely.
Surfer 🏄🏾♂️
Bitcoin futures premium has slipped to a 3-month low despite $5 billion in ETF inflows over 30 days through June 18. Traders in Bitcoin derivatives are turning cautious, with futures and options metrics flashing bearish signals.
Genius Group, a Singapore-based artificial intelligence education company, expanded its corporate Bitcoin treasury by 34 BTC in the past month despite a previous ban on the Nasdaq-listed firm’s corporate accumulation. This brings its holdings to 100 BTC, purchased for a total of over $10 million.
The price of Gold rose to $3,450 per ounce last week, just $50 shy of its all-time high in April. Gold has gained 30% since the beginning of the year, catalysed by US President Donald Trump’s trade tariffs and an escalation of military action in the Middle East.
Token Dispatch View 🔍
Even though institutional ETF flows remained robust above the $1-billion mark, Bitcoin’s collapse alongside traditional risk assets during the Iran crisis definitively challenges its "digital gold" positioning. This rejection shows that there’s still a disconnect between the decoupling narrative and reality of Bitcoin.
The structural bifurcation occurring within crypto markets is evident in how the stocks responded at Wall Street during the week.
While Circle reached $56 billion in market value on regulatory tailwinds, Bitcoin treasury firms face an existential reckoning due to cost and price pressures. Semler's razor-thin 1.05x NAV ratio signals the beginning of a potential unwind cycle where late-adopting corporates become forced sellers, creating the same selling pressure their strategies aimed to avoid.
Fed Governor Waller's July rate cut hints suggest monetary policy accommodation may return just as Bitcoin's safe-haven narrative shows faultlines.
The cleansing of 800K BTC from short-term holders represents healthy base-building, but the concentration risk is mounting. When 89% of transactions exceed $100K and retail flows evaporate, Bitcoin risks becoming a macro hedge fund plaything rather than a democratised monetary alternative.
The path forward hinges on $100K defence and geopolitical de-escalation, but investors should prepare for extended consolidation as markets reassess Bitcoin's role during crisis periods.
That's it for this week's Mempool edition.
See ya, next Monday.
Until then …stay sharp,
Prathik
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