Bitcoin traded around $116,000 on Tuesday, falling back from a historic surge that briefly sent the world's largest cryptocurrency past $123,000 for the first time.

Even with the pullback, the cryptocurrency is still trading at nearly twice its level from a year ago.

Unlike previous cycles, the record run isn't being driven by retail mania or meme-stock energy. This move is being powered by structural demand, shifting macro positioning and a wave of Wall Street adoption that's playing out in real time.

Spot Bitcoin ETFs pulled in $2.7 billion last week, including nearly $1.3 billion in a single day — the second-largest inflow session on record. BlackRock's iShares Bitcoin Trust alone now holds nearly $90 billion in assets, placing it among the 20 largest ETFs in the country, according to Bloomberg Intelligence.

Altogether, U.S.-listed spot Bitcoin ETFs now manage more than $153 billion — a figure that stood at zero just 18 months ago.

That demand is tightening supply and reinforcing bitcoin's status as a mainstream macro asset. Financial advisors, sovereign wealth funds, and corporate treasuries are allocating at a record pace. Holdings by public companies rose 23% last quarter to $91 billion, according to Bitwise.

Firms like GameStop and Trump Media are following the Michael Saylor playbook and treating bitcoin as a strategic reserve, with President Donald Trump's company planning to buy $2.5 billion worth of bitcoin.

Meanwhile, a wave of reverse mergers — backed by SoftBank, Cantor Fitzgerald, and others — is turning dormant companies into bitcoin holding vehicles. New entrants like ProCap, which just raised more than $750 million and plans to hold up to $1 billion in bitcoin, are rushing to go public through SPACs, adding fuel to what some are already calling a bitcoin treasury bubble.

The technical setup has added to the momentum.

June options expiry flushed out selling pressure and triggered a short squeeze, as traders who bet against bitcoin near the $110,000 to $120,000 range were forced to cover. Bitcoin's futures open interest hit a record above $88 billion, a sign of growing conviction from institutions. Ethereum open interest has also been hovering near all-time highs.

Bitcoin has also reestablished its correlation with the Nasdaq.

After temporarily decoupling during the ETF-driven surge, it's now back in sync with tech stocks. The Nasdaq closed at a record high Monday, helping lift sentiment across risk assets — including ether, solana, and XRP.

And now, long-awaited policy clarity may finally be on the way in Washington.

In May, the Department of Labor cleared the path for 401(k) plans to offer access to Bitcoin ETFs, opening the door to retirement savings allocations and deepening the institutional base.

This week, the House is taking up a trio of landmark crypto bills, in what Republican lawmakers are calling "Crypto Week." The legislation includes a framework to divide oversight of digital assets between the Securities and Exchange Commission and the Commodity Futures Trading Commission, new rules for stablecoins, and a bill to block the creation of a central bank digital currency.

While none of the proposals directly target bitcoin, the broader message is clear: Washington is finally beginning to draw the contours of a regulatory regime, and traditional finance is already positioning around it.

Until now, asset managers, banks, and trading platforms have largely stayed on the sidelines, deterred by a wave of SEC enforcement actions and the legal uncertainty over what counts as a security versus a commodity.

The Clarity Act would settle that debate. It would give the CFTC jurisdiction over digital commodities like bitcoin — and potentially ether — while narrowing the SEC's domain.

It's exactly the kind of legal bright line compliance officers have been pleading for.

The bill also aims to clear a path for broker-dealers to handle crypto lawfully. Down the road, it could open the door for institutional decentralized finance by allowing traditional firms to experiment with on-chain finance without immediately triggering exchange or clearinghouse registration requirements.

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