Cryptocurrency exchange Huobi rated Bitcoin and real-world assets Overweight for Q3 in its quarterly HTX Research report, arguing that the quarter rewards liquidity and cash flow over narrative. The report attributes the Q2 sell-off to a liquidity repricing triggered by an energy shock from the Iran war, which pushed inflation expectations higher and prompted a more hawkish Federal Reserve stance. BTC fell from roughly $82,000 to $59,000, a 24% peak-to-trough drop, as spot ETFs swung from $1.97 billion in April inflows to nearly $4.9 billion in combined May-June outflows.

Q2 Liquidity Repricing and Market Impact

The report traces the crypto market decline to a chain reaction involving a stronger dollar and a repricing of risk assets. Despite the price drop, tokenized real-world assets excluding stablecoins grew 9.5% to $32.28 billion over the quarter. On-chain finance expanded even as prices fell sharply, indicating resilience in specific sectors.

HTX identified BTC as the clearest institutional entry point in crypto, now trading as a global dollar liquidity proxy rather than a crypto-native asset. Q3's direction depends on four factors: ETF flows turning positive, the dollar peaking, Treasury financing not draining liquidity, and corporate treasury windows reopening. If the dollar stays strong and outflows persist, BTC is expected to stay range-bound regardless of sentiment.

ETH Outlook and RWA Growth

ETH/BTC fell 13.9% in Q2 as Layer-2 scaling reduced revenue and stablecoin activity migrated to Tron and Solana. With staking yield near 1.42%, ETH could not compete with Treasury rates. HTX rated ETH Neutral / Tactical Long, stating a recovery requires higher fees, renewed ETF inflows, and CLARITY Act progress. If regulation advances, ETH could outperform BTC due to its larger regulatory discount.

Real-world assets were rated Overweight with high confidence as the one sector that does not need a bull market. Tokenized Treasuries grew from $13.65 billion to $15.04 billion in Q2. Circle USYC crossed $3.07 billion to overtake BlackRock's BUIDL at $2.37 billion. Ondo USDY reached $2.15 billion, up 63% over 90 days.

Q3 Scenarios and Probabilities

HTX outlined three scenarios for Q3. The base case, with 60% odds, involves the Fed staying hawkish and BTC holding but remaining range-bound. The 25% bull case requires energy prices falling and the CLARITY Act passing, which would push ETH and DeFi to outperform. The 15% bear case sees oil rising again and CLARITY stalling, making cash and stablecoins the only defensive options. Long-tail altcoins remain Underweight until stablecoin supply grows $10 billion in 30 days, ETH/BTC stabilizes above 0.030, and Bitcoin dominance falls while total market cap rises simultaneously.

A new pricing model developed by PhD researchers Daniels and Hileman establishes a statistically significant link between Bitcoin's value and the USD money supply M2. The model, which demonstrates nearly a 90% fit based on a backtest of nearly ten years of data, suggests Bitcoin acts as a store of value that appreciates as the money supply increases. This economic foundation could provide the market with a consensus on fair value, potentially reducing volatility and expanding Bitcoin's use as a hedge against monetary dilution.

Salomon Brothers has incorporated a modified version of the Daniels & Hileman model into its economic research. The firm's adaptation uses a Monte Carlo simulation to predict prices one year out, factoring in assumptions about future monetary growth. Specifically, the model accounts for an increase in money supply to cover U.S. government spending on military and interest on U.S. debt in 2027, which is expected to drive continued and steady appreciation for Bitcoin.

The research identifies an inverse relationship between Bitcoin and USD monetary dilution. As the Federal Reserve prints money not absorbed by economic growth, the dollar's purchasing power decreases, while Bitcoin, with its fixed supply of 21 million coins, gains value. The model posits that Bitcoin is a better hedge against monetary dilution than Gold, particularly when adjusted for volatility, because Bitcoin's supply cap is enforced by code rather than geology.

Widespread adoption of this valuation model could lead to lower volatility and greater price consensus. Improved predictability may attract more buyers and lenders willing to accept Bitcoin as collateral. The model is currently undergoing private peer review by experts in economics, finance, and fintech, with a public release planned upon completion.