Wintermute Says Crypto Market Shows Signs of Capitulation as Bottom Remains Unconfirmed

The recent cryptocurrency selloff reflects a broader shift away from risk assets, with fading enthusiasm for AI-related trades, weakness in the Nasdaq, a stronger U.S. dollar, and expectations that interest rates will remain higher for longer driving the decline, according to a report from Wintermute.

Against that backdrop, Bitcoin fell 5.9% over the past week, briefly slipping below $60,000 and touching its 200-week moving average, while Ethereum declined 7.9%.

Although market sentiment and on-chain data suggest investors are entering a capitulation phase, Wintermute said the market has yet to confirm a durable bottom. The firm cited continued ETF outflows and subdued buying in treasuries and stablecoins as signs that demand remains insufficient to signal a sustained recovery.

Looking ahead, Wintermute said fresh liquidity may continue to favor AI-related equities before returning to cryptocurrencies. It also noted that Strategy's updated Bitcoin monetization framework suggests the long-assumed "permanent bid" from corporate treasury companies is becoming increasingly conditional.

Source: Wintermute