2025
The bull market of summer 2025 is markedly different from previous ones. Funding sources no longer rely primarily on policy injections from the Federal Reserve or the Treasury Department, but are driven by equity gains from large tech giants and record-breaking capital expenditures. These funds are channeled through corporate treasuries (TCo) and
new ETF mechanisms, cascading into the crypto market and creating a self-reinforcing flywheel effect. This article will delve into this mechanism, analyze changes in the buyer structure of ETH and BTC,
and provide forecasts for the future market based on macroeconomic conditions and policy factors.
Despite the Federal Reserve tightening its policies and fiscal stimulus weakening, risk assets continue to surge, driven by two overlapping chains. First, AI
-driven capital gains and record-breaking capital expenditures by large tech giants are transmitted through wages, supplier payments, and shareholder dividends, continuously injecting risk capital into the crypto market. Second, crypto corporate treasuries
(TCo) have established a new transmission mechanism, directly converting the reflexive euphoria of the stock market into on-chain buying pressure, thereby forming a self-reinforcing market flywheel.
This flywheel effect not only withstands seasonal weakness and macroeconomic noise but also sustainably drives market gains until top-tier corporate capital expenditures decline or ETF demand stalls. In other words, this bull market is driven by liquidity created by large publicly traded companies, rather than traditional monetary or fiscal policies.
Shift in liquidity sources and new crypto buyers
Traditionally, market liquidity has relied on the Federal Reserve or the Treasury Department, but liquidity has now shifted. The equity gains and over $100 billion in capital expenditures from tech giants like NVIDIA and Microsoft are radiating across the economy, affecting not only suppliers and employees but also driving retail investors to increase their holdings of risky assets, particularly in the crypto market.
Meanwhile, the crypto market has seen the emergence of new structural buyers—corporate treasuries (TCo). In previous cycles, the absence of large buyers was one of the reasons for price volatility, but now corporate treasuries for BTC and
ETH not only serve as a funding bridge but also defend key price ranges and drive price breaks. Corporate treasuries can be divided into two generations: early TCo are price-insensitive and only serve as a floor; new ETH-related TCo have price-seeking functions and can actively buy when equity value accelerates, thereby forming a complete self-sustaining cycle: corporate stock issuance brings in funds, TCo buys reserve assets to drive token price increases, while the value of TCo-held parent company stocks rises, reducing financing costs, which are then reinvested into the crypto market, repeating the cycle.
It is important to note that this mechanism is not risk-free. If ETFs or retail investors fail to fill critical price gaps, a vacuum may emerge, causing token prices to plummet rapidly. Short-term volatility remains a concern.
Structural Changes in Ethereum
The ETH market has significantly diverged from previous cycles. In the past, buyers were primarily retail investors and miners, but now ETFs and TCo have become the market’s main players, jointly addressing liquidity gaps. The defense of price ranges and phased purchases have formed a new market narrative.
From a technical analysis perspective, this phenomenon can be understood using the “cup theory”: prices first form a low point (the cup’s base) within a specific range, then slowly rise (the cup’s rim), forming an overall
U-shape. When prices break through the rim, it typically indicates that the market has the potential to continue rising. In the Ethereum market, corporate treasuries focus on defending the price range between $3,000 and $3,500, while
ETFs make phased purchases during the intermediate gaps, akin to filling the cup with water, enabling prices to break through the rim smoothly and continue the upward trend.
If demand for ETH from tech companies remains strong, this rally has room to continue; if demand is insufficient, the market may experience a brief pause and correction. Overall, the shift in market buyer structure means Ethereum is no longer solely reliant on retail investors or miners but is supported by institutions and corporate treasuries, making the market more stable and providing conditions for sustained price increases.
Dual drivers of macroeconomic conditions and tech giants’ capital expenditures
In the current market environment, macroeconomic factors and AI development are intertwined, influencing economic and market trends. U.S. commodity sales prices have risen for several consecutive months, with implied inflation levels of approximately
4%, indicating that price pressures persist. Despite this, the Federal Reserve may still tolerate a certain degree of inflation under the premise of overall labor market stability to support economic growth. However, the persistently high youth unemployment rate is often seen as an early warning signal of an economic cycle—young people are typically the first to feel economic fluctuations. If employment conditions remain weak, the overall labor market may come under pressure, and risk assets could also be affected.
Tech giants’ capital expenditures are becoming an important source of liquidity for the market. Ultra-large tech companies are making massive investments in
AI infrastructure, not only providing funding for dividends to suppliers, employees, and shareholders but also potentially significantly boosting the economy’s total factor productivity in the medium to long term. If the productivity gains from AI
meet expectations, by 2055, the U.S. public debt-to-GDP ratio could drop from the baseline of 156% to approximately 113%, with per capita GDP also increasing by approximately
17%. However, it is important to note that historical experience shows that the productivity effects of technological innovation typically lag behind, and markets often discount these future gains in advance, which is part of the logic behind the current high valuations of stock markets and cryptocurrencies.
Meanwhile, uncertainty over trade policies and tariff pressures are altering corporate investment behavior. Faced with a complex international trade environment and policy ambiguity, many companies are increasingly inclined to allocate funds to financialized assets rather than long-term capital expenditures, such as factories, equipment, or expansion projects. This short-term preference for capital flows into asset markets has, to some extent, supported the rise in risk assets, forming a structural backdrop of a liquidity-driven bull market in the private sector.
Investment Strategy
In terms of investment strategy, focus should be placed on high-quality technology giants with
AI
compound growth potential, while selectively positioning in infrastructure sectors such as computing power, electricity, and networks. In the crypto market, Bitcoin can serve as a benchmark asset for risk exposure, while Ethereum plays the role of a “self-reinforcing flywheel,” requiring close attention to key price defense zones and potential gaps. In terms of risk management, monitor the inflow and outflow dynamics of
ETFs , corporate treasury funding arrangements, and capital expenditure plans of large tech companies. Moderate position increases can be made in key defense zones, but if the market breaks out without subsequent support, caution is advised in reducing positions.
Overall, this bull market differs significantly from the 2021 cycle, with the current upward momentum primarily driven by private-sector liquidity led by large technology companies. These companies release funds through equity gains and capital expenditures, with capital flowing to suppliers, employees, shareholders, and retail investors, then transmitted to the cryptocurrency market through corporate treasuries and
ETF structures, thereby forming a self-reinforcing market flywheel. Key price levels are defended by corporate treasuries and supported by phased buying, while ETFs
and retail investors fill the gaps, sustaining market momentum. As long as tech giants continue to actively invest capital, this private-sector liquidity chain remains intact, and the bull market has further room to extend.
