Risk Back on the Menu: Crypto ETFs Stage a Stunning Comeback

Just when Wall Street thought it had the crypto beast caged, the ETFs are roaring again—and they're bringing volatility back to the party.

The Rebound No One Saw Coming

Forget the cautious whispers from traditional finance. The recent surge in crypto exchange-traded funds isn't just a blip; it's a signal flare. Capital is flooding back into digital asset vehicles, proving that institutional interest hasn't cooled—it was merely waiting for an entry point. The narrative that crypto had been tamed by mainstream adoption is crumbling fast.

Volatility Is a Feature, Not a Bug

The bounce-back highlights a fundamental truth the suits often miss: these markets thrive on dynamic price action. The return of 'risk on' sentiment isn't a malfunction—it's the engine restarting. While traditional portfolios shudder at the charts, this is the environment where crypto-native strategies are built to perform, bypassing the sluggish consensus of legacy markets.

A New Phase of the Game

This isn't 2021's retail frenzy. This is a more calculated, if equally hungry, wave. The infrastructure is stronger, the players are sharper, and the stakes are woven into the broader financial system. The comeback cuts through the recent noise of regulatory scrutiny, showing that product demand ultimately dictates the flow.

The bottom line? The crypto winter thaw has turned into a spring rally for ETFs. For the traditional finance crowd now nervously adjusting their models—welcome back. Try to keep up. After all, nothing makes a hedge fund manager sweat like an asset class that refuses to follow their playbook.

Indices

BTC bounced off $85,000 lows, and is back up to $92,000. Over the past three weeks, BTC has increased 5%, with significant volatility throughout. In particular, BTC has been underperforming through the EU session, while outperforming in the US and APAC sessions.

Over the past week, oracles, lending and ethereum ecosystem tokens performed well, with each up just over 4%. Crypto equities performed the best, up 6.7%, primarily due to outperformance by HOOD.  

The Nasdaq 100 (+1.70%) and S&P 500 (+0.78%) continue to grind up, while Gold underperforms slightly (-0.85%).

In terms of worst-performing, gaming has outperformed significantly toward the downside, with -23% returns over the past week. LGCT was the worst performer, and declined in price by -75% over the past week. 

Charts for The Week

Odds have surged (up to 78% on Kalshi) that Kevin Hassett will be President Trump’s next Federal Reserve chair nominee, an announcement TRUMP recently confirmed is imminent. Hassett, a close White House ally, is favored because he aligns with the president’s demand for much lower interest rates to provide cheaper consumer loans and mortgages.

Bitcoin ETF flows reversed sharply in November, posting significant net outflows after a steady run of inflows from May through October. The month saw roughly $3.46 billion in redemptions, completely erasing the $3.42 billion in new inflows seen last month and the worst outflows since February 2025 ($3.56 billion). The reversal highlights how quickly sentiment deteriorated despite months of strong accumulation. The alignment between ETF flows and price action remained intact, with November’s outflows closely mirroring BTC’s double-digit monthly decline.

The first week of December has been the first positive net inflow week for BTC ETFs since the last week of October, with $70.2 million in net BTC ETF inflows. Ethereum and Solana ETFS have both seen higher net inflows this past week, at $312 million and $108 million, respectively.

In terms of network revenue, we’re seeing similar figures to what we saw the week prior, with Hyperliquid leading the charge with 35% of all network revenues, followed by Tron (20%) and Solana (15%). Noticeably, BNB revenue is still at lows following the highs it put in October, and the majority of that has been captured by Hyperliquid and Solana.

Application revenue has stopped declining (now at $38 million, 10% higher than last week), following four weeks of net decline across all tracked applications. Hyperliquid continues to lead the way (35%), followed by pump.fun (25%) and Axiom (8%).

Helius’ Lostin and Ichigo proposed SIMD411, which aims to accelerate Solana’s emission schedule by doubling the disinflation rate from -15% to -30%, keeping the 1.5% terminal inflation unchanged. This simple, predictable parameter change WOULD bring inflation from ~4.14% today to 1.5% in ~3.1 years (early 2029), rather than ~6.2 years (early 2032). If implemented, SIMD411 would cut 22.3 million SOL ($2.9 billion) in emissions after six years vs. the current inflation path, reducing the “leaky bucket” sell pressure.

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