Regulation
The cryptocurrency market surges in May with major regulatory approvals
Market time in May
The cryptocurrency market experienced a significant uptrend in May, ending the month with an 8.6% increase in total market capitalization. According to Binance Research, this surge was largely driven by favorable regulatory actions. Key developments include the US Securities and Exchange Commission (SEC) approving eight Ethereum (ETH) exchange-traded funds (ETFs) and the US House of Representatives passing the Financial Technology and Innovation Act for the 21st century (FIT21). The price of ETH increased by 21.2% in the single day prior to the ETF’s approval, which spurred a broader market recovery.
Impact on Ethereum and Bitcoin ETFs
Following the approval of ETH spot ETFs, Grayscale’s Ethereum Trust (ETHE) has seen its discount to net asset value continue to narrow, now standing at 1.4%, the lowest level in almost three years. The market will closely monitor flows of ETHE and recently approved ETH spot ETFs to assess their impact on the broader market.
Bitcoin (BTC) has also benefited from these regulatory developments, with BTC spot ETFs recording 14 consecutive days of net inflows in May, contributing to the market’s overall positive performance.
Solana network developments
In another significant development, Solana stakers have approved a proposal to distribute 100% of priority commissions to network validators, moving away from the previous model where 50% of commissions were burned. Additionally, Solana’s daily network transaction fees came closer than ever to those generated by Ethereum, while the Phantom wallet rose to third place in the utility category on Apple’s app store.
Growth of tokenized Treasury securities
Tokenized US Treasuries hit a new high in May, recording approximately $1.5 billion in value on-chain, marking 80% year-to-date (YTD) growth. BlackRock’s USD Institutional Digital Liquidity Fund has been a key driver of this growth and is now the largest fund in the sector.
Rebirth of prediction markets
Prediction markets have also seen a recovery this year, with total value locked (TVL) rising 68.6% since January. In May, net deposits topped $60 million for the first time, thanks in part to the upcoming U.S. presidential election. Platforms like Polymarket have benefited significantly from this increased activity and are expected to see further growth as the election approaches.
For further details you can access the full report on the site Binance Search website.
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