Bitcoin set for ‘choppy summer’ as capital chases high-flying AI stocks, K33 says
The firm still views bitcoin as undervalued relative to equities, but says investors are rotating into AI stocks as the opportunity cost of missing gains by holding BTC is too high.
What to know:
- Bitcoin faces difficult summer months as investors favor AI-related stocks and upcoming tech IPOs over crypto, K33 Research said.
- The capital rotation is apparent in bitcoin ETFs seeing their second-largest three-week outflow streak on record.
- The firm previously called $60,000 the cycle low but now warns that rising leverage and fading institutional demand could lead to deeper losses.
“Much of the market views the opportunity cost of holding BTC as too high while anything AI-related soars,” Lunde wrote.
The divergence has become increasingly difficult to ignore. Bitcoin has failed to reclaim its 200-day moving average while the Nasdaq and S&P 500 continue setting record highs. Investors are also looking ahead to potential IPOs from companies such as SpaceX and Anthropic, which may be drawing capital away from crypto, Lunde argued.
That rotation is evident in bitcoin ETF flows. Spot bitcoin exchange-traded products shed 62,794 BTC over the past three weeks, the second-largest outflow streak on record, the report noted.
K33 said ETF selling accelerated after bitcoin’s failed attempt to break above its 200-day moving average last month.
$60,000 bottom being questioned
The shift in tone marks a notable change for K33. The firm previously argued bitcoin’s plunge to around $60,000 in February likely marked the deepest drawdown of the cycle. A key part of that thesis was unusually negative funding rates in perpetual futures markets, which reflected persistent bearish positioning and created conditions for powerful short squeezes.
