Traders once again prefer dollars over bitcoin. USDT, USDC dominance rises.

Your day-ahead look for May 27, 2026

What to know:

This is an excerpt from CoinDesk newsletter 'Daybook.' Sign up here, if you haven't already.

A market dynamic that characterized the steep bitcoin BTC$75,685.45 and crypto market selloff early this year is making a comeback: Traders are again preferring dollars over the largest cryptocurrency.

This is evident from trends in their respective dominance rates, a measure of a cryptocurrency's share in the total market value of the digital asset market.

BTC's dominance rate has pulled back to 60% from 61.20% since May 5. At the same time, the dominance rate for Tether's USDT, the largest dollar-pegged stablecoin, increased from 7% to 7.5% while Circle Internet's (CRCL) USDC, the second-largest, rose from 2.8% to 3%.

In other words, money seems to be rotating back into tokenized versions of the U.S. currency. That makes sense because bond markets suggest the Fed may keep interest rates elevated longer than previously anticipated. Higher interest rates make the dollar and dollar-linked investments attractive. Assets like bitcoin, meanwhile, offer no inherent yield or cash flow.

It's not the first time this has happened this year. A similar scenario occurred in late January, just before the selloff in BTC gathered pace, driving prices down to $63,000 in early February. These trends, therefore, need to be closely watched.

Bitcoin was recently trading near $75,900, having put in lows near $75,200 early today after reports of a large block trade in BlackRock's bitcoin ETF, IBIT. The transaction saw shares worth over a billion dollars change hands.

The 11 spot ETFs lost over $333 million on Tuesday, following the $2.26 billion in outflows over the past two weeks. Meanwhile, gold and precious metals funds have been pulling in investor money. Talk about rotation!

Ether (ETH), XRP, solana (SOL) and the CoinDesk 20 Index have each dropped about 2% in 24 hours.

"If cryptocurrencies are once again acting as a barometer of sentiment in global financial markets, this looks like an early signal of a reversal towards profit-taking," said Alex Kuptsikevich, the chief market analyst at FxPro. "Perhaps investors prefer to take their money off the table ahead of the start of summer, beginning with the riskiest segment."

In traditional markets, Nasdaq e-mini futures traded at record highs above 30,000 points and WTI oil fell 3% to $90 per barrel. The U.S. ADP employment report due today could add volatility to markets. Stay alert!

Read more: For analysis of today's activity in altcoins and derivatives, see Crypto Markets Today . For a comprehensive list of events this week, see CoinDesk's "Crypto Week Ahead."

What’s trending

• Whale alert: Someone dumped $1.29 billion of BlackRock's bitcoin ETF in a dark pool trade (CoinDesk): A single investor dumped over a billion dollars-worth of shares in BlackRock’s bitcoin, which trades under the ticker IBIT, in one dark-pool trade.
• Treasury yields fall as investors remain optimistic on Iran peace deal prospects despite U.S. strikes (CNBC) U.S. Treasury yields fell Wednesday as investor optimism over a potential settlement to the war in Iran was undeterred by pressure on the fragile ceasefire between Washington and Tehran.
• U.S. funds set aside cash as SpaceX and OpenAI prepare to go public, analysts say (Reuters): Large mutual funds and passive index funds ​are setting aside more cash and preparing to offload some of their existing holdings in large-cap stocks, as ‌they prepare to add upcoming blockbuster IPOs like SpaceX and OpenAI to their portfolios.
• Bitcoin drops to 13th largest asset as capital flees to AI and precious metals (CoinDesk): Bitcoin has fallen to 13th place among the world’s largest global assets after slipping to roughly $76,000.

Today’s signal

The chart shows trends in dominance rates for bitcoin, USDT and USDC since May 5.

While BTC's share of the total crypto market has declined, the dollar-pegged tokens' shares have increased.

These diverging trends point to renewed trader preference for the U.S. currency, a sign of capital flight to safety and potential risk aversion ahead.

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