Bitcoin (BTC) Price Surpasses $100k as the Market Rallies

On May 9, 2025, the crypto market saw a strong rally, with Bitcoin (BTC) breaking above $103,000 for the first time since January.

May 9, 2025 saw the crypto market experience a strong rally. Bitcoin (BTC) price surged past $103,000 to hit the highest level since January, while Ethereum (ETH) and many altcoins also posted impressive gains.

The total global crypto market capitalization rose above $3.22 trillion, while the Fear & Greed Index climbed from 48 (neutral) to 63 (greed) in just three days. According to Santiment, the number of retail wallets buying BTC and ETH has increased sharply since the beginning of the week.

What’s driving this impressive recovery?

Source: Alternative.me

Rise In Rate Cuts Sentiment

U.S. jobless claims data on May 8 showed a slight decline to 228,000 filings, down from 241,000 the previous week. The earlier spike was largely attributed to seasonal factors in New York State and is not necessarily indicative of a broader trend in layoffs.

However, investors are still concerned about the health of the U.S. economy, and they are interpreting the Fed’s decision to keep rates steady at 4.25%–4.50% as a sign that the central bank is considering the risks of recession.

As a result, expectations of rate cuts in Q3 2025 are continuing to support risk assets, including cryptocurrencies.

Source: CME Groups

The 10-year U.S. Treasury yield fell to 4.38%, and the DXY index (which measures the strength of the U.S. dollar) dropped to a three-week low, signaling a shift in capital toward speculative assets.

Another key factor is the growing concern over stagflation—a scenario in which economic growth slows while inflation remains high, prompting investors to seek store-of-value assets like Bitcoin.

With the Fed holding rates and offering no clear guidance on cuts in June, markets are increasingly pricing in a more dovish monetary stance in the quarters ahead. In this environment, Bitcoin, often referred to as “digital gold,” is emerging as a compelling hedge, especially as the dollar weakens and macro uncertainty rises.

Strong Inflows Into Bitcoin ETFs: A Key Catalyst

The first week of May 2025 saw strong inflows into U.S.-listed Bitcoin ETFs, highlighting the increasing interest from institutional investors in digital assets.

On May 8, 2025, alone, total inflows into Bitcoin ETFs reached $117.4 million, with:

Over the past three weeks, Bitcoin ETFs have attracted more than $5.3 billion in cumulative inflows, showcasing a surge in demand from traditional investors.

It is noteworthy that since the start of 2025, IBIT has surpassed the SPDR Gold Shares (GLD) in net inflows, with over $6.96 billion, signaling a shift from gold to Bitcoin as a preferred store-of-value asset.

Source: CoinGlass

Ethereum ETF Hopes and Pectra Upgrade

Ethereum has experienced a remarkable rally of nearly 20% over the past seven days. This surge can be primarily attributed to two key catalysts: the successful rollout of the Pectra upgrade on May 7, which improves network performance and streamlines staking, and speculation that the SEC may approve one or more spot Ethereum ETFs ahead of the May 23 deadline.

The Pectra upgrade not only enhances the transaction experience and scalability of the Ethereum network but also modifies the staking parameters, making it potentially easier for retail investors to engage in ETH staking—a factor that could drive demand for long-term holding.

According to BeaconChain, over 400,000 ETH have been added to staking in the three days since the upgrade, signaling the largest spike since January 2024.

Number of Ethereum validator after Pectra – Source: Beaconcha

Additionally, Bloomberg reports that the SEC held several closed-door meetings with ETF issuers last week, sparking speculation of a potentially favorable surprise decision—much like the swift approval of spot Bitcoin ETFs earlier this year.

U.S.–U.K. Trade Deal Hopes Boost Risk Sentiment

Amid ongoing global geopolitical uncertainty, a new statement by President Donald Trump has helped lift market sentiment. Trump announced that the U.S. is preparing to unveil a major trade deal with a “very respected” country, which analysts widely interpret to be the United Kingdom.

Markets quickly took this as a signal that the U.S. may be softening its trade stance, potentially easing tensions with key partners after a prolonged period of tariffs and protectionist policies.

“PRESIDENT TRUMP: "I will be having a major TRADE DEAL announced tomorrow morning in the Oval Office at 10:00 o'clock. A big, and highly respected country will be joining us. Great news for the U.S. and for the