economy
Bitcoin is weathering its ugliest week in months as narrative fades and liquidity rotates
Bitcoin is getting pummeled to kick off June as the market loses its dominant narrative and liquidity continues to rotate into other assets.
TL;DR
- Bitcoin has fallen 13% this week, marking its worst performance since February, due to a loss of its dominant market narrative and liquidity rotation into other assets.
- Bitcoin ETFs have experienced 13 consecutive days of net outflows, reducing total assets under management significantly.
- MicroStrategy's first Bitcoin sale since 2022, though small, has negatively impacted investor confidence, breaking its 'never sell' mantra.
- The cryptocurrency is not acting as digital gold, an inflation hedge, or a high-beta tech stock, losing ground to the stock market's performance, particularly in semiconductors and AI infrastructure.
- Analysts are reassessing the drivers of the next crypto cycle, with some predicting a potential price bottom below $40,000 by late October, based on a four-year cycle analysis.