What did markets get HYPEd about in May?

Authors: Matthew Mena, Stephen Coltman, Maximiliaan Michielsen

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Key takeaways

• May opened strongly for Bitcoin and broader risk assets, with Bitcoin decisively breaking through the key resistance levels highlighted in our last monthly update. 
• The S&P 500 and the NASDAQ-100 also made fresh all-time highs, as cooling tensions in the Middle East prompted growing optimism for a ceasefire, and the potential reopening of the Strait of Hormuz catalyzed a risk-on rally.
• Hyperliquid's US spot-ETF debut was the most successful crypto launch on record relative to its size, as investors rewarded a platform built on real revenue and strong token-holder alignment.

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What happened in May?

The month’s global macro narrative was shaped by two dominant forces: the Strait of Hormuz oil supply shock and an accelerating AI capex cycle. Although the Strait remains closed, the fragile US-Iran ceasefire held, and investor confidence that strategic petroleum releases bridge near-term energy deficits drove oil prices down 10% from mid-month peaks – despite elevated commodity inputs weighing on inflation and consumer confidence.  Meanwhile,  AI infrastructure spending drove a sharply bifurcated equity market: most domestic sectors compressed or traded sideways, while tech surged over 15% on the month, extending year-to-date gains to 30%.

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Reasons supporting crypto’s price action

May delivered a pivotal structural milestone for digital assets. Bitcoin defended the $75,000 support before decisively breaching the $78,000 resistance level that constrained price action for most of this year, propelling it above $80,000 for the first time since February. Price has since entered a healthy consolidation phase, retesting the $75,000 support zone, which continues to attract aggressive bids.

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Reawakening in the altcoin market: Hyperliquid US ETFs enter the market

Beyond Bitcoin’s localized strength, the broader digital asset ecosystem is showing early rotational dynamics, with aggregate crypto market capitalization expanding over 10% from its early-April baseline.

The structural highlight of the month was the US ETF debut of Hyperliquid, the world’s largest decentralized derivatives platform. Launching on May 11, the two HYPE ETFs drew roughly $104 million of net inflows over their first 11 trading days – a stretch in which the token rallied as much as 50%, to a high near $63 on May 25. More telling than the dollar figure is what it represents relative to the asset's size: those flows equate to nearly 0.8% of HYPE's market capitalization absorbed in under two weeks. That is the highest share captured by any spot crypto ETF launch at the same point in its life, pointing to unusually concentrated demand for a newly wrapped asset of HYPE's scale.

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Hyperliquid continues to capture strong traction beyond traditional digital asset trading: digital assets averaged ~75% of aggregate trading volume for the month, showing growing strength in commodity and equity trading; while non-digital assets now make up five of the top 10 traded assets on the platform.

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Bull vs. bear case scenarios

Bull case: regime shift confirmation and trend recovery (medium probability)

• A formal peace deal with Iran materializes, removing the primary macro overhang and allowing oil prices to normalize.
• BTC reclaims $78,000 on a weekly close with conviction, opening the path to ~$82,000-$85,000; sustained acceptance above that level would signal the corrective phase has been resolved.

Bear case: extended consolidation or renewed downside test (low probability)

• Ceasefire negotiations collapse, and the Strait re-escalates, driving oil above $120 and formally reigniting recession risk.
• The $78,000 rejection holds; overhead supply from underwater holders, and sidelined four-year-cycle capital keep BTC range-bound through Q2.
• A break below $75,000 opens the downside toward the $65,000–$70,000 

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