Wintermute: AI Sector Draining Liquidity, US Selloff Pressure Dominates Market, Bitcoin Entering High Volatility Price Discovery Phase

BlockBeats News, February 10th, Wintermute stated, "Bitcoin fell to $60,000 last week, erasing all gains from the Trump election. Spot flows show significant structural pressure. Coinbase premium has been in a discount state throughout the entire market process and has been persistent since December last year, indicating long-term selling pressure from the United States. Internal OTC flow data also confirms that U.S. counterparties have been the main sellers throughout the week, and this trend has been further amplified by continuous ETF fund redemptions.

Over the past few months, AI-related assets have been continuously absorbing available market funds, crowding out fund allocation space for other asset categories. The phenomenon where crypto assets underperform when AI-related companies rise and their price declines are magnified can almost entirely be explained by capital rotation into the AI sector. To get crypto assets back to outperforming, AI trading needs to cool off first. Microsoft's weak earnings report has begun this process, but it is far from enough.

Last week's market was like a 'surrender-style' liquidation, with soaring volatility and buy orders stepping in at $60,000. In an environment where spot trading volume remains low, leverage has become the primary driver of price fluctuations. If open futures contracts do not recover significantly, it will be difficult for the market to sustain follow-through on either side of the long or short positions. A true structural repair requires the return of spot demand, but there is hardly any evidence of this at the moment.

We are likely entering a phase of high volatility and oscillation in price discovery. It is difficult to see sustained upward momentum until the Coinbase premium turns positive, ETF fund flows reverse, and basis rate stabilizes. Meanwhile, retail investor attention has been diverted to other asset categories, and the market direction seems to be increasingly dominated by institutional fund flows from ETFs and derivatives channels."