Wintermute warns Bitcoin lacks inflows needed to confirm market bottom

Bitcoin’s recent selloff has yet to establish a durable market bottom as institutional demand remains absent and capital continues to leave spot Bitcoin ETFs, according to a new market note from Wintermute.

According to data from crypto.news, Bitcoin (BTC) traded near $61,828 on Tuesday, down 3.18% over the past 24 hours and more than 14% over the past week after falling to its lowest level since September 2024. The broader cryptocurrency market also remained under pressure, with total market capitalization dropping 2.8% to $2.21 trillion.

According to CoinGlass data, more than $1.78 billion in leveraged positions were liquidated over the past day as long traders absorbed most of the losses. Total crypto derivatives open interest stood at around $103.5 billion, while daily futures trading volume reached $173.8 billion.

According to the latest weekly note from algorithmic market maker Wintermute, the recent correction differs from previous pullbacks because institutional demand continues to deteriorate rather than stabilize. The firm argued that the market remains vulnerable to further downside as large buyers have yet to return in meaningful size.

Wintermute said attention surrounding Strategy’s sale of 32 BTC between May 26 and May 31 has overshadowed the broader issue facing the market. While the transaction itself was relatively small, the firm believes the real driver of weakness has been a retreat by U.S. institutional investors that previously helped fuel Bitcoin’s rally earlier this year.

ETF flows continue to point lower

Wintermute’s concerns are reflected in spot Bitcoin ETF flows, which have experienced persistent redemptions over the past several weeks.

Data from SoSoValue shows U.S. spot Bitcoin ETFs recorded a net outflow of $91.37 million on June 8, reversing the modest inflows seen earlier in the month. Between May 15 and June 3, the funds endured a 13-session outflow streak that erased roughly $4.37 billion from the sector before briefly stabilizing on June 4.

The first week of June alone accounted for approximately $1.72 billion in net outflows. BlackRock’s IBIT led the withdrawals, losing about $1.38 billion, while Fidelity’s FBTC recorded outflows of roughly $201.9 million.

The sustained selling has significantly reduced assets held by the ETF sector. Total net assets across U.S. spot Bitcoin ETFs fell from more than $100 billion in mid-May to approximately $79.6 billion by June 8.

Wintermute also pointed to a negative Coinbase premium and weakening over-the-counter activity as evidence that U.S.-based institutions are reducing exposure. According to the firm, institutional desks have adopted a more cautious near-term stance and are using periods of liquidity to trim positions.

Macro headwinds weigh on risk assets

The firm’s outlook comes as financial markets adjust to stronger-than-expected U.S. economic data. The latest nonfarm payrolls report showed the U.S. economy added 172,000 jobs in May, well above market expectations. At the same time, services-sector inflation accelerated, reinforcing expectations that the Federal Reserve may keep interest rates elevated for longer.

Markets are now assigning roughly a 98% probability that the benchmark federal funds rate remains unchanged through the end of 2026, while the U.S. 10-year Treasury yield has climbed to around 4.57%.

Wintermute said the combination of higher yields and fading momentum in the AI-driven equity rally has reduced investor appetite for speculative assets, including cryptocurrencies.

CryptoQuant sees signs of capitulation

Not all market indicators point to further downside, however. CryptoQuant analyst Gaah recently noted that Bitcoin Supply in Loss MA7D has climbed to 50%, its highest level of 2026. Historically, readings above that threshold have coincided with periods of market capitulation and the formation of major cycle bottoms.

The analyst noted that the last time the indicator reached similar levels was in November 2022, shortly after Bitcoin fell below $20,000 during the post-FTX bear market.

Wintermute acknowledged that some longer-term investors are gradually accumulating Bitcoin at current levels, viewing the correction as an attractive long-term opportunity. Still, the firm maintains that a lasting recovery requires renewed institutional demand.

Looking ahead, Wintermute identified the upcoming SpaceX IPO on June 12 as a potential gauge of broader market risk appetite. Until spot Bitcoin ETF inflows return and institutional buyers re-enter the market, however, the firm argues that a durable Bitcoin bottom remains unconfirmed.