First Market News | The weakness of the U.S. economy may prompt the Federal Reserve to adopt a dovish stance, VIRTUAL market capitalization has once again surpassed $1 billion.

Daily Summary: The concept of a rate cut by the Federal Reserve in May is only 5.1%, and weak U.S. economic data may prompt the Fed to shift to a dovish stance.

According to data from Farside Investors, a total of $56.4 million flowed out of US Bitcoin spot ETFs yesterday. Among them, BlackRock’s IBIT saw an inflow of $266 million, while Fidelity’s FBTC had an outflow of $137 million, and ARKB experienced an outflow of $130 million, with other ETFs mostly seeing minor outflows. Since February of this year, BTC ETFs had shown a unilateral net outflow trend, but a reversal trend has emerged since last week, indicating optimistic sentiment in the capital market. Yesterday, the overall trading volume of ETH ETFs was small, with a total outflow of $2.3 million.

CME Federal Reserve Watch: The probability of a 25 basis point rate cut in May is 5.1%

According to CME’s “FedWatch” data, there are 7 days and 2 hours remaining until the next FOMC meeting, with a 5.1% probability of a 25 basis point rate cut in May and a 94.9% probability of maintaining the current interest rate. The probability of the Federal Reserve maintaining interest rates unchanged until June is 29.9%, the probability of a cumulative rate cut of 25 basis points is 66.6%, and the probability of a cumulative rate cut of 50 basis points is 3.5%. In addition, traders have fully priced in that the Federal Reserve will cut rates four times by 25 basis points before the end of 2025.

Weak U.S. economic data may prompt the Federal Reserve to shift to a dovish stance, which could benefit Bitcoin.

According to TheBlock, after the release of U.S. macroeconomic data on Wednesday, Bitcoin briefly fell below the $94,000 mark, with a daily decline of 1%. Major altcoins such as Ethereum and Solana also experienced a simultaneous drop, leading to a nearly 4% pullback in the total cryptocurrency market capitalization. In the first quarter, the U.S. economy contracted by 0.3%, lower than the expected growth of 0.2%. The core PCE for March increased by 2.6% year-on-year, in line with expectations but lower than the revised figure of 3.0% for February. The ADP employment report for April showed an addition of 62,000 jobs, a significant decrease from the 147,000 jobs reported in March.

David Hernandez, crypto investment expert at 21Shares, noted: “Fed funds futures show that the market is now pricing in the Fed potentially cutting interest rates more than 4 times this year. Against the backdrop of slowing inflation and recession signals, policymakers’ balancing act will be key in the coming weeks.”

CoinPanel’s senior automation expert Kirill Kretov believes that interest rate cuts will benefit Bitcoin through three mechanisms: a weaker dollar, improved liquidity, and declining government bond yields. “With a GDP data of -0.3% compounded by President Trump’s increased pressure on the Federal Reserve, the likelihood of a policy shift towards dovish has significantly increased. In the current context of thin Bitcoin liquidity, even a moderate inflow of funds could drive prices up significantly.” The market generally believes that weak economic data may force the Federal Reserve to initiate the easing cycle earlier.

Layer2 project Movement token MOVE experiences abnormal sell-off, faces media accusations.

According to a CoinDesk report, the market-making agreement previously signed by Movement Labs allowed the obscure intermediary Rentech to gain control of 66 million MOVE tokens, leading to a $38 million sell-off of MOVE tokens the day after the TGE.

The internal contract shows that the intermediary Rentech appears as both the agent of the Movement Foundation and a subsidiary of Web3Port, playing a dual role in the agreement, and its domain name was registered only on the day the contract was signed. This contract grants Rentech lending rights to about half of the publicly held MOVE supply and allows Web3Port to liquidate the tokens and share the proceeds with Rentech when the valuation of MOVE reaches 5 billion dollars.

Movement is under investigation for potentially being induced to sign a financial agreement that grants excessive control to a single entity. Movement is also investigating the involvement of its co-founder Rushi Manche, who initially forwarded the transaction with Rentech to the Movement team and promoted it internally. Movement Foundation lawyer Pek labeled the agreement in an email as “possibly the worst agreement he has ever seen,” noting the motivation behind the agreement to pump the price of MOVE tokens and then sell tokens to retail investors. Despite internal opposition, the executives, legal advisors, and advisory team who facilitated the agreement are currently under scrutiny.

Market Analysis: VIRTUAL surged 30% intraday, GORK surpassed a market cap of $50 million within 5 hours of launch.

Market Hotspot

• The AI agent project VIRTUAL surged nearly 30% intraday, with a market value exceeding $1 billion; on the news front, Virtuals officially released the points-based new token mechanism Genesis update: the developer attribution is now public and the automatic locking feature is online, the goal of Genesis Launch is to ensure a fair and transparent token launch, eliminating snipers and conspiracy groups; VIRTUAL had previously reached a market cap high of $5 billion earlier this year, and is currently down nearly 80% from its historical peak;
• The meme coin GORK on the Solana chain surpassed a market capitalization of $50 million within 5 hours of launch and has already been listed on Moonshot; Grok is an artificial intelligence assistant and is the first AI large model product released by Elon Musk’s xAI team, while GORK is a parody of Grok; Crypto KOL Ansem and 0xsun respectively invested $113,000 and $18,800 at the low price of the GORK token to build their positions in this token;

Market Trend

• BTC fluctuated slightly during the day, with a small net outflow from the BTC ETF. The contraction in U.S. GDP growth has not significantly impacted market sentiment; today’s AHR999 index is 0.91, indicating that current prices are still suitable for long-term investors to dollar-cost average.
• ETH has followed the market fluctuations without showing an independent trend, and the ETH/BTC exchange rate has remained around 0.019 since mid-April.
• Altcoins are generally rising, but the upward trend is relatively scattered, with no significant sector-wide increase.

Macro News: US stocks mixed, US GDP down 0.3% in the first quarter.

Last night, US stocks experienced a sharp decline, but in the final trading hours, all three major indexes rebounded sharply, ultimately finishing mixed. The Dow Jones Industrial Average rose 0.35% to 40,669.36 points, the S&P 500 Index increased by 0.15% to 5,569.06 points, while the Nasdaq fell 0.09% to 17,446.34 points. Regarding US Treasury bonds, on April 30, the yield on the benchmark 10-year US Treasury was 4.17%, and the yield on the 2-year US Treasury, which is most sensitive to Federal Reserve policy rates, was 3.60%.

The U.S. economy contracted in the first quarter, raising concerns among investors about a recession. The U.S. Department of Commerce stated on Wednesday that the gross domestic product (GDP) declined by 0.3% in the first quarter, reversing a rapid growth rate of 2.4% in the fourth quarter. The report also indicated that U.S. consumer spending has significantly slowed, and government spending has decreased. Other data suggest that the U.S. economy remains stagnant. The growth rate of consumer spending in the first quarter was the lowest since 2023. Another report showed that spending increased by 0.7% in March, surpassing economists’ expectations of 0.5%.

Author: Icing, Gate.io Researcher *This article only represents the author’s opinion and does not constitute any trading advice. Investment involves risks, and users should make cautious decisions. *The content of this article is original and the copyright belongs to Gate.io. If you need to reproduce it, please indicate the author and source; otherwise, legal responsibility will be pursued.