Good morning, and happy Memorial Day weekend! Crypto is slumping once again, but investors are looking to NFTs as refuge. Cathie Wood is the talk of the town with her tech ETF being targeted and her bold words on Bitcoin’s (CCC:BTC-USD) current flop. D.C. is getting ready for a busy, budget-dense Friday preceding the long weekend. Things are going out with a bang before the holiday. So what will the stock market do today?

• The S&P 500 is up 0.12%
• The Dow Jones Industrial Average is up 0.41%
• The Nasdaq Composite is down 0.01%

So what else will the stock market do today? Here are some of the top stories.

What Will the Stock Market Do Today? Keep Eyes on Cathie Wood

Cathie Wood was the investing rock star of last year. Tech stocks surged, and her cutting-edge ETFs were given room to soar. The Ark Innovation ETF (NYSEARCA:ARKK) saw gains of 152% in 2020, with a portfolio bolstered by plays like Zoom (NASDAQ:ZM), Tesla (NASDAQ:TSLA), and Zillow (NASDAQ:ZG).

The tides are turning for Wood and tech stocks in general. Thanks to inflation, investors are turning away from tech and toward consumer cyclicals. Investment firms are now hedging their portfolios with bearish bets on Wood’s tech ETF, with an increase in put options on ARKK.

Two dozens investment firms are placing puts on the Ark Invest ETF, including Balyasny Asset Management and Blackstone Group. While typically the bearish option would tie to a larger index, these groups are targeting ARKK thanks to its huge growth in the last year. Ending 2019 with a $1.9 billion value, and ballooning to a $28 billion value by mid-February, the opportunity seems like a no-brainer. Efrem Kamen of Pura Vida Investments is saying “the level of fund flows into the ETF appeared to be extreme.”

While the cards are stacking against her on Wall Street, Wood is making waves in cryptocurrency circles. She is pinning the environment, social, and governance (ESG) stock movement for the downfall in Bitcoin values. Notably, she name-drops Elon Musk and his recent Bitcoin controversy as a primary catalyst:

“It was precipitated by the ESG movement and this notion, which was exacerbated by Elon Musk, that there are some real environmental problems with the mining of bitcoin. A lot of institutional buying went on pause.”

Musk’s waffling on Bitcoin is seen as the warning shot of Bitcoin’s huge energy consumption, and the reversal of Tesla’s acceptance of the crypto as a payment method directly preceded the coin’s crash.

Wood is optimistic on how Musk’s statements will affect the currency in the long run. “He has encouraged a lot more conversation, a lot more analytical thinking,” she says. “And I do believe he’s going to become a part of the process.”

Congress Readies for Biden’s Budget Proposal

Things are about to get very interesting on Capitol Hill; Biden’s 2022 budget proposal is about to land on the desks of Congress members this morning. The incoming $6 trillion budget will lead to the highest sustained spending since World War II, and by a huge moment for the Biden administration as they hope to push for infrastructure upgrades.

Plumbing upgrades, widespread broadband internet, robust paid leave expansions and national expansion of electric vehicle charging stations are just a few of the many upgrades he and other Democrats hope to approve. “Now is the time to build the foundation that we’ve laid, to make bold investments in our families, in our communities, in our nation,” he told a crowd at a Cleveland rally on Thursday.

With Democrats controlling both the House and the Senate, Biden’s chances of getting budget approval stand higher than any previous president. Still, there is a thin line he must walk in order to gain approval. One of the biggest issues is over funding the plan. Biden wants to increase taxes on corporations and high-earners in order to fund the budget. He stands currently to let Donald Trump’s tax cuts for low and middle-income earners expire in 2025.

The success of the budget will rely on appeasing moderates, like West Virginia’s U.S. Sen. Joe Manchin, while not alienating progressives who seek even higher corporate taxes. Manchin has been outspoken in his intentions to not support the taxation that Biden is including in the proposal.

NFTs Emerge as a Star Play for Crypto Investors

Non-fungible tokens, or NFTs, are riding high this year as the digital art world continues to grow in legitimacy and popularity. Even auction house Christie’s has an NFT collection. And now, the fiscal ideologies of the “old-school” art world are coming to digital art.

Crypto, and meme coins in particular, are crashing yet again today. Shiba Inu (CCC:SHIB-USD) and Dogecoin (CCC:DOGE-USD) are being hit hard alongside blockchains like Ethereum (CCC:ETH-USD). The losses build on a rough few weeks for the asset class.

However, while these cryptos began crashing in the weeks prior, savvy investors were moving their money into NFTs. Trading volumes in NFTs are seeing a 277% increase since January. The Chinese crackdown on crypto is a large factor in this; NFTs are safe from regulation.

The interest in deregulated art is growing because people are thinking about it the same way they think about that original Warhol print they have in storage. “Pranksy,” a well-known NFT collector, holds 100,000 NFTs, and says that the digital art is protected from crypto fluctuations:

“The people who spent many thousands on NFTs aren’t going to sell them for 50% off tomorrow, at least not many are. Much like traditional art markets bucking Wall Street trends I believe many see certain NFTs as a store of value.”

On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.