The research arm of the world’s largest cryptocurrency exchange has released a report highlighting key developments and market movements in the digital asset sector for May. The analysis provides insights into growth and challenges observed across various sectors, including decentralized finance (DeFi), exchange-traded funds (ETFs), gaming, and tokenization.

According to Binance Research, the cryptocurrency sector experienced a 10.3% increase in market capitalization, driven by bitcoin (BTC) reaching a new all-time high (ATH) and substantial inflows into ETFs.

Market Highlights for May

The growth in May was a continuation of the upward momentum witnessed in April. Major crypto assets saw strong gains, and even ether (ETH), which has been underperforming in this bull run, posted a 43.9% recovery.

As the market rebounded, volatility remained elevated due to changes in U.S. trade policies. There were renewed tariff tensions between the U.S., China, the European Union, and the UK, which triggered market uncertainty. Although a court ruling eventually halted all tariffs temporarily, the U.S. government subsequently reinstated them.

Despite the cautious macroeconomic environment, BTC saw increased institutional adoption. Corporate entities have embraced the digital asset as they have become more confident in its long-term value as a hedge and strategic asset. Around 116 public companies collectively expanded their treasuries to 809,100 BTC as the asset’s ATH renewed the fear of missing out (FOMO) among the firms. More firms unveiled multi-million dollar plans to acquire BTC as regulatory clarity improved.

Corporate Entities Are Diversifying

Although BTC has remained the core reserve asset among corporate treasuries, some firms are cautiously diversifying their investments into ETH, XRP, and Solana (SOL).

“Looking ahead, the trajectory of corporate crypto treasuries will depend on broader macro conditions, regulatory evolution, and market cycles. Momentum remains strong for now, with Bitwise projecting that corporate treasuries could exceed 1 million BTC by 2026,” the Binance Research team stated.

Coming down to sectors, Binance Research found that May witnessed structural divergence and capital rotation. DeFi’s 19% growth was attributed to new product launches and yield opportunities. Meme coins rose 9.3%, while Artificial Intelligence (AI)-related tokens and Real-World Assets (RWAs) spiked 4.7% and 3.6%, respectively. In contrast, the Gaming and Layer-2 sectors remained weak.

Meanwhile, U.S. spot Bitcoin ETFs recorded inflows of at least $5.2 billion, the highest since November 2024. However, profit-taking amid renewed macroeconomic uncertainty toward the end of the month triggered outflows of up to $962 million.