Weekly Institutional Insights: Retail buying continues; Stablecoin bill might pass

Mar 24, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Enjoy our weekly take on the market!

Weekly highlight — retail buying continues

Source: Bloomberg

In a turbulent stock market facing trade issues and economic slowdown fears, retail investors are undeterred, increasing their investments despite mounting losses.

In the week ending Mar 19, 2025, individual traders invested over $12 billion into US equities, significantly above their 12-month average, according to JPMorgan Chase. This aggressive buying suggests that stocks may not have hit bottom yet, as retail investors typically hold on longer during downturns.

This behavior mirrors previous down years, such as 2022, when the equity benchmark fell 19%. Currently, retail investors are facing a 7% loss for the year, while the S&P 500 has dropped 3.7%.

Despite a sharp market sell-off in late February 2025, retail buyers remained active, contrasting with institutional investors who exited US stocks quickly. A recent Bank of America report showed significant stock inflows from both institutional and private clients, totaling $43.4 billion this year.

However, Wall Street sentiment is increasingly bearish, with several major firms downgrading their expectations for US equities. Individual investor sentiment has also weakened, with bullish views dropping below 20% for three consecutive weeks.

Disconnection between investor sentiment and actions is evident, highlighting that retail investors are continuing to invest despite prevailing bearish attitudes.

Weekly crypto highlight — Stablecoin bill on track for approval

A key US House committee is set to advance significant stablecoin legislation, a priority for President Donald Trump and the crypto industry. The House Financial Services Committee panel will review the bill on April 2, driven by bipartisan support from figures like New York Senator Kirsten Gillibrand and increased campaign funding for pro-crypto candidates.

Committee Chairman French Hill emphasized that a regulated stablecoin market could enhance the US dollar's dominance, modernize payments and improve financial access without government overreach. Crypto firms are advocating for stablecoins as a means to provide affordable and faster financial services globally.

Dollar-backed stablecoins are designed to bolster demand for US dollars, and are typically supported by highly liquid assets. However, critics, including Congresswoman Maxine Waters and Senator Elizabeth Warren, argue the legislation lacks consumer protections. They seek to ban tech companies like X and Meta from issuing stablecoins, and highlight concerns over the absence of safeguards such as FDIC insurance, as well as potential risks to deposit levels and credit access.

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