Coinbase Stacks Bitcoin as SEC Eyes Onchain

Happy Friday, TM Family!

Welcome to the Token Metrics Research | Daily newsletter, where we cover key market movements, regulatory updates, and early alpha for our readers and investors. 

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Now let's get back to the top stories of the day.

Bitcoin kicked off August with a sharp dip, briefly touching $114,000 before recovering to around $115,900, marking a 3% decline over the past 24 hours. This move triggered over $630M in leveraged position liquidations, with more than $580M hitting long bets, the largest such event in recent weeks.

Ether followed suit, dropping to $3,616 before stabilizing near $3,690, down about 5.7%. Altcoins like DOGE, SOL, and XRP fell 6% each, with SOL retreating to $170 and XRP below $3, while speculative tokens like Fartcoin and Pump.fun saw even steeper intraday corrections.

The catalyst? A resurgent U.S. dollar index (DXY), topping 100, its highest since late May, was fueled by President Trump's new tariffs, which exacerbated inflation (core PCE at 2.8% YoY in June). This dimmed hopes for a September Fed rate cut, with probabilities dropping to 39% per CME's FedWatch tool. The Japanese yen weakened to a four-month low past 150.50 per dollar, adding global pressure. July closed mixed: BTC lost momentum despite an all-time high earlier in the month, impacted by Galaxy's 80,000 BTC unload, while ETH surged 56% and broke above $2,813.

This shaky start underscores crypto's sensitivity to macro factors, but historical patterns suggest looser conditions could propel BTC to $150K-$200K if the economy cools. For natives, monitor nonfarm payrolls data today; a miss could reignite rate-cut bets. Position sizing should favor BTC dominance over alts in this environment. Long-term holders: Accumulate on dips, as treasury vehicles and ETPs offset selling pressure.

Coinbase reported Q2 2025 earnings with revenue of $1.5B, up slightly YoY from $1.45B but missing estimates of $1.59B. Adjusted EBITDA fell to $512M from $596M, with transaction revenue plunging 39% QoQ to $764M despite rising crypto prices. The stock tumbled 8% in after-hours trading, reflecting weaker trading activity.

Coinbase acquired 2,509 BTC for ~$222M, boosting holdings to 11,776 BTC (~$1.3B value), re-entering the top 10 public BTC treasuries ahead of Tesla (11,509 BTC). The firm plans to increase BTC holdings via weekly purchases and launch tokenized stocks, prediction markets, and new U.S. offerings like derivatives and expanded staking. Stablecoin revenue rose 12%, emphasizing on-chain finance via Base L2 and ETF custody.

For crypto natives, Coinbase's BTC stack (separate from 884,388 customer BTC) positions it as a pure-play treasury play, akin to MicroStrategy. Tokenized stocks could bridge TradFi and DeFi, boosting Base TVL. Short-term, the earnings miss signals headwinds from low volumes, but diversification into infrastructure (e.g., super-apps) offers upside. Watch for Q3 catalysts like global expansion.

Ethereum Foundation researcher Justin Drake revealed the "Lean Ethereum" roadmap, a 10-year plan for simplicity, security, and efficiency. Key focuses include transitioning to post-quantum signatures for quantum resistance, streamlining transaction validation, and scaling to 10,000+ TPS on the mainnet without compromising decentralization. The roadmap balances performance with SNARK-based upgrades, aiming for $1T staked.

Meanwhile, spot Ether ETFs posted a 20-day inflow streak, the longest since debut, with $17M net on July 31, totaling ~$5.4B. BlackRock's ETHA led with $18.2M, Fidelity's FETH at $5.62M; Grayscale's ETHE saw $6.8M outflows. Total assets: $21.52B (4.77% of ETH market cap). This contrasts BTC ETFs' $114.83M outflows, signaling rotation. Onchain: Strategic reserves hit 2.73M ETH ($10.5B), ETFs at 5.88M ETH ($22.5B).

The roadmap fends off quantum threats, enhancing ETH's utility for DeFi and enterprise. ETF inflows reflect institutional conviction, tightening supply. Stake for yields and watch for a $4K breakout. Rotation from BTC could drive gains if the macro eases.

SEC Chairman Paul Atkins launched "Project Crypto", a commission-wide initiative to modernize securities rules and move U.S. markets on-chain, aligning with Trump's "crypto capital" vision.

Key pledges: Clear guidelines for crypto as non-securities, purpose-fit disclosures, exemptions for ICOs/airdrops/staking, self-custody support, and "super-apps" under single licenses. It aims to reshore businesses, protect developers, and adapt regs for DeFi/tokenized securities. Solana Policy Institute is pitching compliant frameworks.

This regulatory thaw reduces uncertainty, catalyzing on-chain adoption for RWA tokenization and hybrid apps. Position in DeFi protocols and L1s like SOL/ETH. In the long term, expect inflows as TradFi integrates, and watch for rule drafts.

August may remain volatile due to tariffs and payrolls, but structural drivers (ETFs, regs, treasuries) point to resilience. Stay diversified, hedge macros, and accumulate dips.

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