Algorithmic trading firm Wintermute has cautioned that Bitcoin’s recent price drop does not signal a definitive market bottom, as institutional demand remains tepid and capital continues to exit spot Bitcoin ETFs. In a weekly market note, Wintermute highlighted that the current correction is distinct from prior downturns, driven primarily by a lack of large-scale buyer interest rather than isolated events.
Data from crypto.news shows Bitcoin trading near $61,828 on Tuesday, down 3.18% in 24 hours and over 14% for the week, reaching its lowest since September 2024. The overall crypto market cap fell 2.8% to $2.21 trillion. Over $1.78 billion in leveraged positions were liquidated, with longs bearing the brunt, per CoinGlass.
Wintermute noted that attention on Michael Saylor’s sale of 32 BTC has overshadowed the broader issue: retreating U.S. institutional investors. Spot Bitcoin ETFs endured a 13-session outflow streak from mid-May to early June, shedding about $4.37 billion. By June 8, net assets across these ETFs fell from over $100 billion to roughly $79.6 billion.
The firm points to a negative Coinbase premium and weak over-the-counter activity as evidence that institutions are reducing exposure. Meanwhile, strong U.S. economic data—172,000 jobs added in May—and rising services inflation have strengthened expectations that the Federal Reserve will maintain higher rates, dampening appetite for risk assets like crypto.
Despite bearish signals, CryptoQuant analyst Gaah notes that Bitcoin Supply in Loss MA7D has hit 50%, a level historically associated with capitulation and cycle bottoms, last seen in November 2022. Wintermute acknowledges some long-term accumulation at current prices but insists that a sustainable recovery requires renewed institutional inflows. The upcoming SpaceX IPO on June 12 may offer clues on market risk appetite, but until spot ETF inflows reverse, the bottom remains unconfirmed.