Bitcoin underperforms as AI-led stock rally hits records: ETF outflows, long liquidations, miners pivot
Bitcoin is lagging sharply while AI-driven equities push higher. The Nasdaq is making fresh all-time highs on an AI boom, but Bitcoin has fallen below $70,000 and is still over 40% under last October’s peak.
Demand data points to caution. US spot Bitcoin ETFs saw their biggest monthly outflow of the year in May. On-chain spot buying stayed thin, and corporate holder Strategy reportedly sold part of its position for the first time since 2022. When Bitcoin broke under $70,000, it triggered the year’s largest long liquidation cascade.
The article also highlights why stocks can sustain strength. Equity gains are narrow and concentrated in AI beneficiaries like chipmakers and data-centre operators, and the market is funding the run from corporate earnings. Bitcoin lacks cash flow, so when macro sentiment turns cautious, the main drivers are liquidity and risk appetite.
A direct “competition” signal is emerging from crypto mining. After the 2024 halving compressed margins, several miners have redirected energy and capital toward AI/high-performance computing. The shift coincides with miners selling record amounts of Bitcoin and a decline in network hashrate.
Technically, Bitcoin broke below the $70,000 support on 2 June and is testing range lows around $62,000, with RSI near deeply oversold levels (around 18). Key levels to watch are a reclaim of $70,000 versus renewed pressure toward $60,000.
Traders are likely to focus on ETF flow reversals and broader liquidity trends for signs Bitcoin’s leadership can return.
Bearish
The piece argues the divergence is structural, not random: Bitcoin is suffering from weak demand (largest 2026 spot-BTC ETF outflow in May, thin on-chain buying), forced positioning unwind (largest long liquidation cascade after losing $70,000), and a sector-level capital reallocation (miners directing energy/capex to AI, with record BTC selling and a downshift in hashrate). Meanwhile, AI-led equities have an earnings “backstop,” so they can keep grinding higher as liquidity/risk appetite concentrates in tech/AI.
Historically, when a high-beta asset loses correlation with equities and ETF flows turn persistently negative, BTC often struggles in the short term until flow/liquidity improve. Similar episodes include periods where macro tightness (high yields, strong USD) and persistent outflows coincided with breakdowns of key technical levels—then price tends to oscillate between support tests and sharp liquidation-driven selloffs.
Short-term, the chart levels highlighted ($70,000 as resistance after the break; ~$60,000 as the next support) suggest downside risk remains elevated if ETF outflows continue or liquidity stays restrictive. Long-term, if miners’ pivot proves durable and capital rotation remains toward AI beneficiaries, BTC may face a ceiling on rallies. However, the article notes a potential turning point: a reversal in global liquidity, a Fed-driven shift, or ETF flow improvement could quickly restore risk appetite and correlation—so traders should be ready for a fast regime change rather than a slow grind.