Your day-ahead look for May 26, 2026
By Omkar Godbole|Edited by Sheldon Reback May 26, 2026, 11:20 a.m. 3 min readMake preferred on Fed Chair Kevin Warsh (Andrew Harnik/Getty Images)Key Insights:
This is an excerpt from CoinDesk newsletter 'Daybook.' Sign up here, if you haven't already.
The situation is becoming challenging for cryptocurrency enthusiasts.
Exchange-traded products (ETPs) in the crypto space, particularly ETFs, have seen a decline in appeal among investors as the U.S. Treasury market indicates a prolonged period of high interest rates.
Last week, digital asset investment products saw outflows totaling $1.47 billion, marking the second week in a row of withdrawals and representing the third-largest weekly outflow in 2026, according to CoinShares.
Bitcoin BTC$77,153.85 funds were at the forefront, with a staggering $1.32 billion withdrawn, the highest weekly exit this year. The 11 U.S.-listed spot bitcoin ETFs alone experienced an outflow of $1.26 billion last week, following a previous $1 billion withdrawal. Additionally, ether (ETH) funds saw $223 million pulled out.
Other altcoin ETFs also faced a notable decrease in inflows.
James Butterfill, head of research at CoinShares, noted in a report shared with CoinDesk, "Cumulative outflows over the two weeks now stand at US$2.54bn, suggesting that risk aversion related to Iran has intensified and expanded despite ongoing progress with the CLARITY Act."
The withdrawals coincided with a shift in bond-market traders' expectations that the Federal Reserve will maintain higher interest rates under the new chairmanship of Kevin Warsh.
This sentiment is reflected in the Treasury market curve, where the difference between two- and 10-year yields increased by over 12 basis points last week.
Since the two-year yield is more sensitive to interest-rate forecasts, the widening spread—driven by a rapid increase in the two-year yield—indicates expectations for sustained high borrowing costs in the near future. Similarly, the gap between five- and 30-year yields also expanded, signaling similar expectations.
High interest rates typically deter investors from riskier assets, particularly impacting emerging technologies such as cryptocurrencies and non-yielding assets like bitcoin.
Overall, the combination of outflows and the yield curve trends presents a negative outlook for risk assets. Investors may be reallocating their funds into upcoming IPOs, notably SpaceX, which is anticipated to be the largest ever, and into commodities that are rising amid disruptions to oil supplies through the Strait of Hormuz.
Upcoming U.S. inflation data releases, particularly the Fed’s favored measure, core PCE, set to be revealed on Thursday, could provide clarity on market directions. Keep an eye out!
For further insights into today's altcoin and derivatives activity, visit Crypto Markets Today. For a comprehensive list of events this week, see CoinDesk's "Crypto Week Ahead."
Trending Now
- Brent crude rises as Iran threatens retaliation against ceasefire breaches following U.S. military actions (CNBC): Brent crude oil prices increased on Tuesday as U.S. military activities in southern Iran and President Donald Trump’s inconsistent messaging on negotiations kept traders anxious. The U.S. military reported it “conducted self-defense strikes in southern Iran today.”
- Russia plans strikes on Kyiv military sites, urges foreigners to evacuate (Reuters): Russia announced its intention to carry out "systematic strikes" on military-associated targets in Kyiv, urging foreigners to leave the city following one of its heaviest bombardments since the war began.
- Stablecoin market value reaches $322 billion, surpassing FX reserves of 95 countries (CoinDesk): The total market value of stablecoins has exceeded the foreign exchange reserves of countries like Poland, Thailand, and Mexico, as well as developed economies such as the U.K., Canada, and the oil-rich UAE.
- Hyperliquid challenges Polymarket with new offchain event contracts (CoinDesk): Hyperliquid is entering competition with established betting platforms like Polymarket, offering a unique mechanism for bet resolution and expanding its outcome contracts to real-world events.
Signal of the Day
The BTC-gold ratio. (TradingView)The chart illustrates daily fluctuations in the price ratio between bitcoin and gold in U.S. dollars.
This ratio has been on the rise since March, suggesting bitcoin is outperforming gold, and currently maintains support along a bullish trendline. A rebound from this point would indicate a continuation of the upward trend.
On the other hand, a breach of this support could signify a return to the broader bitcoin bear market.
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Key Insights:
This is an excerpt from CoinDesk newsletter 'Daybook.' Sign up here, if you haven't already.
Note: Daybook will not be published on Monday, May 25, due to the Memorial Day holiday. We will return on Tuesday, May 26.
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