Wintermute Analysis: Bitcoin risks testing the $50,000 zone despite the rebound
Despite the recent bounce of the first cryptocurrency from support around $60,000, analysts at leading market maker Wintermute warn that the market bottom could be significantly deeper. In my assessment, this is not just a bearish forecast, but a sober look at the current macroeconomic and institutional environment.
Last week, Bitcoin broke its prolonged four-week losing streak, bouncing from the $60,000 levels back above $65,000. This surge, however, was not driven by organic capital inflows, but by a unique confluence of two factors that worked in unison for the first time in a long while.
Dual Growth Catalyst: Inflation and Geopolitics
The first factor is the May US inflation data. The annual Consumer Price Index (CPI) settled at 4.2%, marking the highest level since April 2023. The key point here is not the figure itself, but that it matched market expectations. Debt market participants feared worse, and the confirmation of forecasts eased some of the tension. Meanwhile, core CPI slowed to 2.9%, signaling that the peak of the energy impulse has passed.
The second, and in my view more significant, factor is the de-escalation of the conflict between the US and Iran. The parties reached a preliminary deal to unblock the Strait of Hormuz, which immediately impacted commodity markets. Brent crude oil collapsed from $110 to levels above $80 over the month, losing 6.6% in the last week alone. The reduction in the geopolitical risk premium dragged down the dollar and government bond yields, creating a favorable backdrop for risk assets. Wintermute cites the first Fed meeting under Kevin Warsh's leadership on June 17 as the nearest catalyst.
Why $50,000 is a Realistic Scenario?
Despite the positive backdrop, I fully agree with Wintermute analysts' conclusion: it is premature to declare that the bottom has been reached. The main question now is liquidity. Bitcoin, as a macro asset, grows solely on excess liquidity flowing through three channels: stablecoins, spot ETFs, and public holding companies (DAT).
And here the picture is grim. Assets under management of DAT companies have shrunk from $220 billion to $140 billion, and the attraction of new capital outside of Strategy, Bitmine, and Strive has virtually stalled. Spot ETFs are experiencing their longest streak of outflows since launch, while inflows into stablecoins are following the same downward trajectory.
As the history of the last cycle shows, real growth only began after the ETF approval in early 2024 and the subsequent institutional inflow. Currently, institutions remain on the sidelines, while retail investors have shifted to trading stocks and leveraged funds.
My professional conclusion: until we see a reversal in capital flows, any rally will be merely a temporary respite. The risk/reward ratio in the low $60,000 range looks attractive for long-term investors, but each sell-off leaves an increasingly vulnerable holder base. The scenario of Bitcoin moving into the $50,000 zone before a reversal is not just possible; it is the baseline scenario under current conditions.