Why This Edition Matters

Most crypto newsletters chase price. This one explores why capital is moving, and where it might be headed next.

You’ll learn:

• The signal that’s historically marked the start of every altcoin rally

• How the GENIUS Act quietly turned stablecoins into weapons for U.S. dollar dominance (and why it’s a catalyst for crypto markets)

• Why Ethereum and Solana are acting more like financial infrastructure than tokens

• How crypto-AI is solving the core bottlenecks in centralized AI — not just adding hype, but changing the game

If you're managing capital, this isn’t just an update — it’s a strategic map.

1. Bitcoin Has Led Long Enough

If you’ve been following the markets at all you’ve noticed BTC has been the clear winner this cycle. If you’ve felt it’s been taking most of the gains, your intuition is spot on.

What is Bitcoin dominance? It’s Bitcoin’s share of the total crypto market cap, a live indicator of where capital is concentrated.

When Bitcoin holds dominance after reaching a new high, it often precedes a rotation into altcoins as investors search for the next leg of risk-adjusted upside.

Why it matters: The longer BTC dominance stays high, the more pent-up altcoin momentum builds underneath. An extended “dominance plateau” historically precedes capital rotation into altcoins. This plateau is now the longest on record.

2. Altcoin Signals — Small Sparks Before the Fire

Here’s a deeper dive on current Altcoin signals and why they matter.

• Altcoin Season Index: jumped from 11 to 27 in two weeks. Historically, moves from sub-20 to 30+ levels have preceded major rotations:

  • Apr 2021: rose 20 → 40 → altcoins up 80–300% in 45 days

  • Feb 2017: rose 18 → 35 → ETH/BTC doubled by May

• ETH/BTC ratio: 0.0231 → 0.0250 (+8%) in a week, the first 5%+ weekly move since March. ETH/BTC is often the risk switch, when ETH gains vs BTC, capital is moving down the risk curve.

• OTC flow shift: Cumberland and Galaxy both report ETH-plus-basket strategies now make up 30% of client flow, up from just 12% in Q1. Institutional rotation doesn’t start on public exchanges, it starts OTC (where sellers and buyers transact directly with each other to avoid liquidity issues).

Why This Sequence Matters

1. ETH/BTC rising signals that market participants are getting more comfortable taking risk beyond BTC.

2. OTC desks shifting flow shows institutional allocators are making that move quietly.

3. Altcoin Season Index rising reflects the broad momentum, not just one sector.

This exact trifecta, ETH/BTC breakout, OTC rotation, and rising alt-season index, has marked every major altcoin rally since 2016.

Sources: BlockchainCenter.net, CoinMetrics ETH/BTC Ratio (July 2025), Cumberland OTC Desk Market Note (July 12, 2025), Galaxy Digital Trading Insights (July 11, 2025)

🏛️ 3. GENIUS Act — Crypto Just Became Dollar-Native

In a landmark move for digital assets, the U.S. passed the GENIUS Act on June 17, 2025. This legislation anchors the U.S. dollar directly into crypto’s core rails.

Key Provisions (Signed: June 17, 2025)

1. Stablecoins must be fully backed 1:1 by cash or short-term Treasuries.

2. National-charter banks can issue, redeem, and custody stablecoins.

3. Issuers must publish real-time attestations every 24 hours on-chain.

4. U.S. Treasury and OCC have oversight through automated API hooks.

💵 Why Stablecoins Matter — and Why They’re a U.S. Weapon Now

Stablecoins are programmable dollars. They don’t just digitize money, they give it distribution.

Why it matters: This isn’t just good for crypto, it’s good for the dollar. It gives Washington the ability to export dollars digitally, while keeping liquidity and trust onshore.

References: U.S. Senate Banking Committee Summary (June 2025), Circle Policy Brief (June 18, 2025), DeFiLlama, rwa.xyz, Congressional Budget Office Treasury Demand Model (July 2025)

4. Ethereum — The Monetary Operating System

“Ethereum is becoming the financial plumbing for the future.”
— Tom Lee, Fundstrat, June 30

Every stablecoin and real-world asset needs a chain to live on. Despite faster chains and newer narratives, Ethereum remains the core infrastructure for on-chain money, both in liquidity and yield.

🏗️ Stablecoin Infrastructure — TRON Surprised Everyone

TRON’s share shocks most Western allocators. But the traction is real, driven largely by Asian OTC desks, remittance rails, and integrations with platforms like Binance.
(Source: DeFiLlama, July 2025)

RWAs — Ethereum Is the Asset Rails, Not Just the Money Rails

Real-world assets (RWAs) are off-chain financial instruments — like Treasuries, private credit, commodities, and equity — tokenized and brought on-chain.

Here’s where capital is flowing today:

Ethereum is the dominant chain across all RWA categories, with $7.7B in RWA value — 58% market share, more than 2x the next closest chain (ZKSync Era).

Why It Matters

Stablecoins made crypto liquid. RWAs are making it investable.

And Ethereum is quietly powering both.

5. Solana — The Fastest-Evolving Financial Layer

What is TVL? Total Value Locked is the dollar value of all assets locked in a protocol. Think of it as actual capital usage.

• Solana’s TVL just hit $17.5B, 3× year-over-year.

  • Jito (liquid staking): $2.86B

  • Kamino (autonomous vaults): $2.57B

  • Jupiter (DEX + perps): $2.47B

Meanwhile, tokenized equity volume (xStocks) surged from $13M → $48M in two weeks. You can now trade SpaceX, OpenAI, Stripe — like you’d trade TSLA — 24/7, globally, no broker, no hours, no middleman.

Why it matters: This isn’t just speculation. It’s infrastructure.

Solana is building something like an on-chain Nasdaq — fast execution, global accessibility, composable primitives — all tied to real assets and capital flows.

Reference: Helius.dev tokenized equity feed, DeFiLlama TVL dashboard (July 13, 2025)

6. Crypto-AI — Why This Isn’t Just About AI Hype

The AI boom isn’t slowing down and there are 3 primary drivers for an AI progression:

Compute, Data, Algorithms.

But its centralized AI’s bottlenecks are getting worse.

Crypto complements and scales around centralized AI while offering alternatives that solve issues around moral hazard.

By decentralizing cost, access, and trust, crypto-AI unlocks structural advantages:

• Cuts R&D and model costs by distributing compute (COGS falls as network participation scales)

• Improves model quality by tapping global contributors, not just Silicon Valley hires

• Increases transparency by making datasets, incentives, and scoring systems public by design

Bottom line: The next infrastructure layer for AI won’t be closed-source. It’ll be composable, transparent, and globally permissionless — and crypto-native.

References: Bittensor Docs, Akash Network Stats, Render Quarterly Reports, io.net Whitepaper, Grass Protocol Papers

Paris = Bittensor Proof-of-Talk

Our team just returned from Proof of Talk in Paris. Beyond the main stage, the real value was in private meetings with other funds and protocol founders. For ecosystems like Bittensor, the key takeaway was clear: the era of speculative emissions is ending.

Protocol revenue is becoming critical. As token emissions ('alpha') inflate the supply, teams must generate real cash flow to create value and justify their network's token

Why it matters: This is what we want. Real companies solving real problems, with evidence in the form of revenue.

That’s where we’re focused:
Finding these companies early — and getting into them early.
Through the fund. And when it makes sense, through curated SPVs.

If you want access to those, reply to this email with “SPV”

Positioning: This Is the Stack We’re Long

Final Take — The Signal Before the Storm

• BTC dominance plateau = altcoin ignition setup

• GENIUS Act = U.S. dollar natively on-chain

• ETH and SOL = infrastructure, not just assets

• Crypto-AI = the next composable economic layer

• Paris = builders are building — and they’re shipping

This isn’t the end of the rally. This is its beginning.

We’re not waiting for a signal. We’re already in position.

Join Our LP Strategy Call

We’re kicking off a recurring call for fund LPs and interested allocators:

• Behind-the-scenes strategy

• Portfolio construction

• What we’re watching next

If you're already in the fund, you’ll be invited automatically.
If you're not but want in, reply and we’ll make sure you're looped in.

Talk soon,
Mike
Founder, Digital Wealth Insider
https://digitalwealthinsider.com

Sources

1. BTC dominance historical data, TradingView (July 2025)

2. BTC dominance drop after May 2021 ATH, CoinMarketCap

3. Altcoin Season Index, BlockchainCenter (July 13, 2025)

4. ETH/BTC ratio weekly change, CoinGecko

5. OTC flow allocation, Cumberland & Galaxy (June–July 2025)

6. GENIUS Act summary, Senate.gov (June 2025)

7. Tom Lee quote, CNBC (June 30, 2025)

8. Solana TVL and protocol breakdown, DeFiLlama (July 13, 2025)

9. Tokenized equities data via Helius.dev / AInvest (July 2025)

Disclaimer: This content is for informational purposes only and does not constitute financial, investment, legal, or tax advice. Digital assets are volatile and carry risk. Always do your own research.

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