Gate Research Institute: Bitcoin's Annual Transaction Volume Surpasses Visa | Merlin 2.0 Builds "Interest-Bearing and Tradable" BTC Summary

Summary

1. Merlin 2.0 upgrade officially released, aiming to create “interest-bearing and tradable” BTC
2. Crypto mining company MARA to issue $850 million convertible notes to purchase more Bitcoin
3. Goldman Sachs and Bank of New York Mellon jointly launched tokenization solution for money market funds
4. Ethereum lending scale exceeds $30 billion, reaching an all-time high
5. Bitcoin’s annual transaction volume surpasses Visa for the first time, moving towards a global value settlement network
6. Gate Launchpool lists ZKWASM, with a total prize pool of 500,000 ZKWASM

Market Commentary

• BTC — This week, BTC rose 0.72%, underperforming altcoins. BTC price fluctuated between $117,300 and $119,995, showing an overall trend of decline followed by recovery. From July 17 to 20, the price gradually fell from $119,289 to a low of $117,300, then saw a significant rise on July 22, breaking through $119,000. However, on July 23, the price slightly retreated to $118,754, indicating some selling pressure at higher levels. In the short term, the market may continue to test the $120,000 resistance level.
• ETH — This week, ETH surged 9.48%, outperforming the average gain of altcoins. ETH demonstrated a robust upward trend over the past 7 days, with the price climbing from $3,368 on July 17 to $3,765 on July 22, showing strong market confidence. Although the price slightly retreated to $3,746 on July 23, the overall trend remains bullish with active trading volume. In the short term, Ethereum may continue to challenge resistance levels above $3,800, with market sentiment remaining optimistic.
• Altcoins — This week, mainstream altcoins generally showed an upward trend. The median price change for the top 100 cryptocurrencies by market cap was 3.40%. CFX was the best-performing token this week, with a gain of 75.22% over the past 7 days.
• ETF & Derivatives — On the ETF front, BTC ETFs have seen net outflows in the past 3 days, due to BTC consolidating around $120,000 and declining 7-day returns. ETH ETFs, however, have experienced 12 consecutive days of net inflows, as ETH has led altcoin gains over the past 7 days, with its price briefly breaking $3,800. In the futures market, over the past 24 hours, BTC and ETH contracts saw liquidations of $67.14 million and $149 million respectively.
• Macro Data — The initial estimate for the U.S. One-year inflation expectation in July is 4.4%, lower than the market expectation of 5.0%. This data reflects consumers’ expectations of easing inflationary pressures, potentially allowing more flexibility for Federal Reserve monetary policy adjustments.
• Stablecoins — The total market capitalization of stablecoins increased to $269.8 billion, indicating further inflow of off-chain funds.
• Gas Fees — This week, the Ethereum network’s Gas fees decreased significantly compared to last week. As of July 24, the average daily Gas fee was 0.477 Gwei.

Hot Sectors

The cryptocurrency industry continued to rise this week, with market sentiment remaining optimistic and most mainstream altcoin sectors gaining. According to Coingecko data, Oracle, RWA Protocol, and Chain Abstraction sectors all showed upward trends this week, rising 8.9%, 8.2%, and 8.2% respectively over the past 7 days.

Oracle

Oracles are crucial interfaces between blockchains and the external world, responsible for importing off-chain data into blockchains, including market prices, weather information, event results, etc., allowing smart contracts to access external information. Given the inherent closed nature of blockchains, oracles play a vital role in fields such as DeFi, prediction markets, insurance, and gaming. In addition to bridging the limitations of blockchains, they also facilitate the interaction between smart contracts and real-world data, expanding the application scope of blockchain technology. — This sector rose 8.9% over the past 7 days, with UMA, Chainlink, and April gaining 16.0%, 11.7%, and 10.2% respectively.

RWA Protocol

RWA Protocol tokenizes real-world assets (such as real estate, bonds, etc.) through blockchain technology, significantly enhancing asset liquidity and accessibility, and building a bridge between traditional finance and the digital economy. Its core value lies in enabling digital management and trading of assets through smart contracts, lowering investment thresholds and increasing transparency. — This sector rose 8.2% over the past 7 days, with Centrifuge and Ondo gaining 11.9% and 9.7% respectively.

Chain Abstraction

Chain Abstraction aims to simplify the user and developer experience by hiding the complexities of on-chain financial interactions. The goal of Chain Abstraction is to enable developers to quickly and securely build chain-agnostic applications that can run seamlessly on all rollups without worrying about the complexities of underlying execution. Its vision is to allow users to interact with decentralized applications without needing to understand the underlying crypto concepts. The purpose is to eliminate all technical complexities and provide an intuitive user experience. — This sector rose 8.2% over the past 7 days, with Router Protocol and Agoric gaining 55.0% and 54.3% respectively.

Focus of the Week

Merlin 2.0 Upgrade Officially Released, Aiming to Create “Yield-Generating and Tradable” BTC

Hester Peirce, a Republican SEC Commissioner, stated in a recent panel discussion that a physical subscription and redemption mechanism for crypto ETFs “will definitely happen at some point,” with related applications currently under review. Several firms, including BlackRock, have submitted proposals to the SEC to shift Bitcoin ETFs from cash-based to physical redemption models. In January, Nasdaq filed a 19b-4 form on behalf of BlackRock to advance this change, followed by similar moves from other firms. Peirce noted significant corporate interest in the physical mechanism.

The introduction of physical redemption will align Bitcoin ETFs more closely with traditional financial products, reducing the “alternative asset” label for cryptocurrencies. This will enable more direct and efficient institutional participation, significantly boosting crypto’s legitimacy and credibility in mainstream finance. Increased institutional involvement and regulatory scrutiny will drive greater transparency and compliance, enhancing the industry’s reputation and strengthening cryptocurrencies’ influence in the global financial system.

Crypto Mining Company MARA to Issue $850 Million Convertible Notes to Purchase More Bitcoin

Crypto mining company MARA Holdings announced the issuance of $850 million in 0% convertible notes to purchase more Bitcoin (as well as repay $50 million in old notes and for general corporate purposes). This move by MARA Holdings highlights its high confidence in Bitcoin’s long-term value and strategic deployment to optimize asset allocation through capital operations. This action not only provides the company with funds to increase its Bitcoin holdings, strengthening its investment position in the cryptocurrency market, but also demonstrates sound financial management strategy through debt repayment and support for daily operations.

Goldman Sachs and BNY Mellon Jointly Launch Tokenization Solution for Money Market Funds

Goldman Sachs and BNY Mellon have partnered to launch a blockchain-based tokenization solution for money market funds. BNY Mellon clients can now invest in tokenized money market funds through Goldman Sachs’ platform, with holdings recorded on-chain. The initiative has attracted participation from major asset managers such as BlackRock, Fidelity, and Federated Hermes, aiming to build a real-time, low-friction digital financial infrastructure.

This blockchain-based money market fund tokenization solution marks a significant advancement in the integration of traditional finance and blockchain technology. Its importance lies in leveraging digitized holding records and real-time transaction mechanisms to significantly enhance investment efficiency and transparency, offering clients a more convenient and cost-effective financial service experience. The participation of top-tier asset managers reflects the market’s broad recognition of blockchain’s potential in financial applications. Moving forward, this solution is expected to drive more traditional financial institutions to accelerate blockchain adoption, fostering an efficient, decentralized digital financial ecosystem. This will further bridge the gap between traditional markets and emerging technologies, creating broader opportunities for digital transformation in the global asset management industry.

Key Market Data Highlights

Ethereum Lending Scale Surpasses $30 Billion, Reaching Historic High

According to data from Token Terminal, as of July 2025, the total active loan volume of lending protocols in the Ethereum ecosystem has exceeded $30 billion, nearly a tenfold increase from less than $3 billion at the beginning of 2023. This rapidly rising curve not only reflects the recovery of DeFi lending activities but also indicates that on-chain capital utilization and leverage preference are continuously improving. Especially against the backdrop of recovering market risk appetite and steady upward movement of ETH prices, users are more inclined to collateralize assets for leveraged operations or liquidity cycling.

Behind this growth, on one hand, it has benefited from the improved liquidity of staked assets driven by the LRT (Liquid Staking Derivatives) narrative, with assets like stETH and rsETH widely used in lending protocols, promoting capital circulation and leverage strategy adoption. On the other hand, leveraged structures derived from lending protocols such as Aave, Morpho Blue, and Ethena Labs have continuously increased capital utilization efficiency. Additionally, institutional-grade funds are intervening through composite strategies like “EigenLayer”, Instadapp, and Gearbox, making Ethereum the main battlefield for on-chain leverage and yield strategies. Overall, this trend signifies that Ethereum is transitioning from an “asset settlement platform” to an “on-chain leverage and yield strategy center”.

Bitcoin Annual Transaction Volume Surpasses Visa for the First Time, Moving Towards a Global Value Settlement Network

Data from Sygnum, a regulated digital asset bank, shows that by mid-2025, Bitcoin network’s annual transaction volume has reached $20 trillion, surpassing Visa’s settlement scale of $13 trillion in the same period for the first time, highlighting its potential as a global value transfer infrastructure. Bitcoin is not only approaching traditional financial giants in transaction volume but also completing cross-border large-sum settlements in a trustless manner, with its decentralization, security, and censorship-resistant characteristics increasingly favored by institutions and high-net-worth users. This trend also reflects that despite price volatility, Bitcoin is transitioning from a speculative asset to an efficient value exchange tool.

Meanwhile, Bitcoin’s liquidity supply on exchanges has dropped to a nearly seven-year low, indicating that holders generally prefer long-term holding (HODL), with assets flowing to cold wallets, custodial institutions, or on-chain smart contracts. Furthermore, benefiting from ETF approval and continued institutional entry, global Bitcoin ETF holdings have exceeded $150 billion, with U.S. spot ETFs accounting for the majority. Listed companies like MicroStrategy and Tesla collectively hold over 900,000 bitcoins, estimated to be worth over $1 trillion at current market value. Overall, Bitcoin is accelerating its transformation from a “highly volatile asset” to “digital gold” and a “systemic settlement asset”, with on-chain data, fund flows, and product forms simultaneously moving towards a more mature asset evolution stage.

Solana Staking ETF Breaks $100 Million, On-chain Yields Entering Traditional Asset Allocation System

The REX-Osprey SOL Staking ETF (ticker: OSOL) launched by asset management company REX Shares on July 2nd has surpassed $100 million in assets under management, becoming the first ETF in the U.S. market to combine spot Solana exposure with on-chain staking rewards. This product obtains native yields through on-chain staking, allowing investors to not only capture the potential price appreciation of SOL but also simultaneously capture the current approximately 6% annual native staking yield of the Solana mainnet (data from Staking Rewards), with actual returns depending on ETF structure and execution efficiency.

The rapid attraction of funds to this product reflects market confidence in high-performance public chain assets in the medium to long term. The collaboration between REX and Osprey also signals that traditional asset management institutions are gradually embracing the trend of allocating to “on-chain yield-generating assets”. With the success of OSOL, it is expected to drive more mainstream Layer 1 projects’ staking yield products into ETF structures, further promoting the integration of staking yields into traditional financial systems.

Market Opportunities

Gate Launchpool

The featured IDO this week: ZKWASM

Delphinus Lab is the core development team of ZKWASM, the world’s first open-source virtual machine that supports generating zero-knowledge proofs for WebAssembly (WASM). This technology supports verifiable off-chain computation and builds modular rollup architecture. Its ecosystem includes a Launchpad with native support for zero-knowledge proofs, which can be used to deploy verifiable dApps, as well as verifiable mini-games for real application scenarios.

How to Participate

• Gate Account: Register and complete verification.
• Deposit Assets: Ensure sufficient USDT and ZKWASM in the account. This Launchpool supports staking in two currencies.
• Staking Window: Until July 29, 2025, 12:00 (UTC)
• Steps: First, log in to Gate and enter the “Launchpool” page; Second, select the ZKWASM project and click “Participate Now”; Finally, enter the staking amount and confirm to participate.
• Total Pool: 500,000 ZKWASM
• APY: 397.76%

Funding Weekly Recap

According to RootData, from July 17 to July 23, 2025, a total of 21 crypto projects announced completed financing or acquisitions, covering multiple tracks such as infrastructure, Web3 games, AI computing, cloud mining, etc., showing continued market attention to fundamental capability building and user application expansion. Here’s a brief introduction to the top three projects by financing scale this week:

Polymarket

Polymarket announced on July 22 that it will acquire the derivatives exchange QCEX for $112 million, officially launching its regulatory compliance strategy to re-enter the U.S. market.

Distinct Possibility Studios, founded by EverQuest co-creator John Smedley, is dedicated to creating an open-world shooter game that combines MMORPG and FPS elements. Their first AAA title Reaper Actual is expected to launch on Steam and Epic Games Store. The funding will be used for game development and exploring new directions in Web3 gaming.

MEI Pharma

Announced on July 22 the completion of a $100 million directed private placement financing, with funds to be used to launch a Litecoin reserve strategy.

MEI Pharma is a U.S. listed a biopharmaceutical company, and this action marks it as the first publicly traded company on a national exchange to hold Litecoin as a strategic asset. The company plans to include Litecoin on its balance sheet as a long-term financial and anti-inflation tool, demonstrating a forward-looking layout for blockchain assets.

GameSquare

Announced on July 17 the completion of a $70 million public offering, with funds earmarked to significantly bolster its Ethereum holdings.

GameSquare, a Nasdaq-listed U.S. Gaming and entertainment tech companies focused on esports, media, and the creator economy, stated that this financing is a critical step in its strategic transformation. It aims to build one of the most ambitious Ethereum reserve strategies in the public market. The CEO emphasized that Ethereum will become a key component of the company’s balance sheet, supporting its long-term growth vision.

Next Week to Watch

Token Unlocks

According to Tokenomist, the following major token unlocks are coming up in the next 7 days (2025.7.25 - 2025.7.30):

• JUP will unlock tokens worth approximately $31.18 million in the next 7 days, accounting for 1.78% of the circulating supply.
• KMNO will unlock approximately $13.81 million worth of tokens in the next 7 days, accounting for 9.62% of the circulating supply.
• SIGN will unlock tokens worth approximately $12.40 million in the next 7 days, accounting for 12.50% of the circulating supply.
  
  
  Reference

• Gate, https://www.gate.com/trade/BTC_USDT
• Gate, https://www.gate.com/trade/ETH_USDT
• Coinmarketcap, https://coinmarketcap.com/
• Farside Investors, https://farside.co.uk/btc/
• Coinglass, https://www.coinglass.com/LiquidationData
• jin10, https://flash.jin10.com/detail/20250708230038826800
• Coinmarketcap, https://coinmarketcap.com/view/stablecoin/
• etherscan, https://etherscan.io/gastracker
• Coingecko, https://www.coingecko.com/en/categories
• Odaily, https://www.odaily.news/post/5205194
• X, https://x.com/btcNLNico/status/1947978046579106158
• CNBC, https://www.cnbc.com/2025/07/23/goldman-sachs-bny-money-market-fund-digital-tokens.html
• X, https://x.com/REXShares/status/1947636614215225479
• Staking Rewards, https://www.stakingrewards.com/
• X, https://x.com/Cointelegraph/status/1948155625021551099
• Sygnum, https://www.sygnum.com/news/sygnums-new-bitcoin-investor-handbook-as-bitcoin-reaches-new-ath-it-tops-visa-in-transaction-volumes-driven-by-etf-demand/
• BitcoinTreasuries, https://bitcointreasuries.net/
• Gate, https://www.gate.com/launchpool/MAT?pid=320
• Rootdata, https://www.rootdata.com/Fundraising
• Tokenomist, https://tokenomist.ai/

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