**Wintermute has issued a stark warning about Bitcoin's current market conditions, stating that "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 Wintermute's latest analysis, the recent correction differs from previous pullbacks because institutional demand continues to deteriorate rather than stabilize, with large buyers yet to return in meaningful size. The warning comes after Bitcoin traded near $62,000 after a 14% weekly drop, back to levels last seen in September 2024, with Bitcoin's positive sentiment score collapsing from 814 on June 3 to 61 now, a fall of more than 92%. As reported by BeInCrypto, Wintermute noted that attention surrounding Strategy's sale of 32 BTC between May 26 and May 31 has overshadowed the broader issue facing the market, though 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.
The spot Bitcoin ETF market has demonstrated sustained weakness, with U.S. spot Bitcoin ETFs recording a net outflow of $91.37 million on June 8, reversing the modest inflows seen earlier in the month. According to SoSoValue data, 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, with BlackRock's IBIT leading the withdrawals, losing about $1.38 billion, while Fidelity's FBTC recorded outflows of roughly $201.9 million. This represents a significant shift from the previous trend, where U.S. spot Bitcoin ETFs recorded 13 straight sessions of net outflows through early June, with approximately $4.4 billion redeemed since mid-May. The sustained selling has significantly reduced assets held by the ETF sector, with total net assets across U.S. spot Bitcoin ETFs falling from more than $100 billion in mid-May to approximately $79.6 billion by June 8.
Stablecoin exchange reserves have drained significantly, providing concrete evidence of capital outflows from the crypto market. According to CryptoQuant data reviewed by BeInCrypto, the pool peaked at $75.12 billion on November 12, 2025, roughly a month after BTC's all-time high, and has since fallen to $62.81 billion as of June 10, 2026, representing a 16% decline. The broader stablecoin market cap tells the same story, with DefiLlama showing the total float at $315.97 billion, down $3.25 billion in the past week after topping near $323 billion. This represents a complete round-trip of the entire fourth-quarter build and returns reserves to a level even lower than late September 2025, before the price peak even formed. The ETF outflow streak has been unprecedented, with May reopening the wound with $2.43 billion out and June already shedding $1.89 billion in just 10 days, nearly 80% of May's total. During this outflow era, fund assets nearly halved from $147.73 billion to $77.58 billion, while prices halved from the record high to $62,000.
Strategy's variable rate perpetual preferred stock Stretch (STRC) has come under significant pressure, with the stock trading at $95.42 on Thursday, remaining below the $100 level since mid-May. According to Grayscale's analysis, STRC's total notional amount stands at nearly $10.5 billion, with the stock designed to trade near $100 and currently paying an 11.5% dividend. A share price below that level raises required investor returns and could increase dividend obligations, which Strategy can meet by adjusting payouts but at the cost of higher cash-flow pressure tied to its bitcoin-backed balance sheet. STRC edged up 0.8% to close at $95.42 on Thursday, while MSTR gained 2.2% to finish the day at $129.37, though the stock remains down roughly 30% over the past month. Grayscale notes that Strategy's levered business model is under pressure, and this has increased the volatility for the BTC market as a whole.
More than $1.78 billion in leveraged positions were liquidated over the past day as long traders absorbed most of the losses, according to CoinGlass data. Total crypto derivatives open interest stood at around $103.5 billion, while daily futures trading volume reached $173.8 billion. According to Wintermute, institutional desks have adopted a more cautious near-term stance and are using periods of liquidity to trim positions, with negative Coinbase premium and weakening over-the-counter activity as evidence that U.S.-based institutions are reducing exposure. The broader cryptocurrency market also remained under pressure, with total market capitalization dropping 2.8% to $2.21 trillion amid the macro environment. However, long-term holder wallets continue to absorb coins even as their pace thins considerably, providing some bullish support despite the overall bearish sentiment.
Despite the recent volatility, institutional adoption continues at unprecedented pace, with Morgan Stanley signaling that U.S. banks may eventually be permitted to hold Bitcoin on their own balance sheets despite existing regulatory friction. The bank has already launched a Bitcoin-based exchange-traded product and intends to roll out spot crypto trading on its Wealth platform later this year. Western Union has launched its proprietary stablecoin USDPT on the Solana blockchain, accelerating cross-border settlement and bypassing legacy interbank rails for international remittance flows. BitMine has expanded its Ethereum reserves to $13 billion, accumulating more than 100,000 ETH in each of the past three weeks for total holdings of 5,180,131 ETH - equivalent to 4.29% of total Ethereum supply. Wintermute acknowledges that some longer-term investors are gradually accumulating Bitcoin at current levels, viewing the correction as an attractive long-term opportunity, though the firm maintains that a lasting recovery requires renewed institutional demand. Rekt Capital projects a potential bottom for BTC at $44,627, representing a 64% retracement from the peak, while his ceiling stretches to $93,000 for 2027, with new record highs unlikely before 2028.
