Wintermute warns AI-fueled liquidity drain is suffocating Bitcoin

Wintermute says AI stocks are siphoning liquidity from crypto, leaving Bitcoin stuck in high‑volatility, low‑spot demand price discovery as U.S. selling and ETF outflows bite.

Bitcoin’s latest lurch lower is no mystery: liquidity is bleeding into the AI trade, and the crypto market is being left to dance on thinning ice.

Macro rotation and Wintermute’s warning

Market maker Wintermute notes that Bitcoin “briefly fell to $60,000 last Monday, erasing all gains since Trump’s election,” as spot flows reveal “significant structural pressure.” The firm highlights that the “Coinbase premium has consistently been in a discount state… since last December, indicating ongoing selling pressure from the U.S.,” while internal OTC data shows “U.S. counterparties were the main sellers throughout the week,” a trend “amplified by continuous ETF fund redemptions.”

Wintermute argues that “over the past few months, AI‑related assets have been continuously absorbing available market funds, crowding out the allocation space for other asset classes,” with crypto underperformance largely explained by “the rotation of funds towards the AI sector.”

High‑volatility price discovery

Last week’s action resembled a “surrender‑style clearing, with volatility soaring and buying support emerging at $60,000,” Wintermute observes, adding that “in an environment where spot trading remains relatively low, leverage has become the dominant factor in price fluctuations.” Without a rebound in open interest, “it will be difficult for the market to form sustained follow‑through on either the long or short side.”

A “true structural recovery” now hinges on “a return of spot demand,” a positive Coinbase premium, reversing ETF flows, and stabilizing basis, the firm says. Until then, Bitcoin is “entering a phase of high volatility and choppy price discovery,” with direction “increasingly dominated by institutional fund flows from ETFs and derivatives channels” as retail attention drifts elsewhere.

Related coverage on structural selling and ETF flows can be found via ChainCatcher’s analysis of Bitcoin slipping below key moving averages, BlackRock’s renewed transfers to Coinbase Prime, and Hyperscale Data’s growing BTC treasury holdings.

Spot benchmarks and AI‑crypto pulse

At the time of writing, Bitcoin trades near $68,700, down less than 1% over 24 hours, on roughly $46B in volume, while total market value hovers around $1.37T. Ethereum’s market cap stands near $242B, with about $28.6B changing hands in the last day.

Within AI‑linked crypto, the Artificial Superintelligence Alliance’s FET token changes hands around $0.16, on roughly $39M in 24‑hour volume. Render (RENDER) trades close to $1.31, with about $35.8M in daily turnover. Akash Network (AKT) is near $0.32, with a market cap just under $92M and 24‑hour volume around $2.8M. SingularityNET (AGIX) sits near $0.07, on modest volume of around $41K.

Wintermute’s bottom line is blunt: “For crypto assets to outperform again, AI trading needs to cool down first.” Until that rotation snaps back, Bitcoin’s next act will be written in volatility, not in trend.