Wintermute: Crypto is no longer the highest-beta asset. AI company stocks are now more volatile. Even if the macro environment improves, the dollar will first flow into AI stocks rather than crypto.

Macro

• Nasdaq fell by 4.5%—its fifth consecutive down session. The Russell 2000 rose by 1.4%, and long Treasuries also posted gains—this is a rotation out of big tech, not a broad risk-off move.
• Micron reported better than expected results and raised its guidance—but still plunged. A classic signal: expectations have outpaced even a strong result.
• Semiconductors are under pressure: SMH dropped by 7% in the session, and South Korea’s KOSPI briefly triggered an automatic trading halt.
• SpaceX has retraced from its IPO debut, and OpenAI is postponing its listing until 2027 in pursuit of a $1 trillion valuation.
• PCE for May came in at 4.1%, the highest since 2023. September is now seen by the market as the date for a possible rate hike.
• Brent fell by 8.1% for the week; the dollar hit a year-to-date high near 101, and the yield on 10-year Treasuries dropped to ~4.38% amid demand for safe-haven assets.

Crypto

• BTC fell by 5.9%, breaking below $60k for the first time since late 2024 and touching ~$59.3k. That’s more than 50% below its peak of $126k. The coin is now at its 200-week moving average—a historically significant bottom-level indicator.
• ETH fell by 7.9%, trading around $1,580. Cryptocurrencies moved in tandem with Nasdaq.
• ETFs saw outflows of about $1.8 billion for the week—the largest since their launch.
• The Fear & Greed index is hovering around 18–24 (extreme fear) since October 2025. The share of coins held at a loss is approaching 50%—in previous cycles, the crossover with coins in profit occurred at around 60%, so there could still be room for further declines.
• A structural problem: crypto is no longer the most highly leveraged asset. AI company stocks are now more volatile. Even if macro conditions improve, marginal dollars will go into AI stocks first, rather than crypto.

Strategy (MSTR/STRC)

• STRC fell to an all-time low around $72. The MSTR premium over BTC-NAV has shrunk to ~1.0x—at zero premium, the accumulation mechanism stops working.
• The company announced a “Digital Credit Capital Framework”: the STRC dividend has been raised to 12%, a $1 billion buyback of preferred and common shares plus another $1 billion, and a reserve of ~$2.55 billion has been set up for 17+ months.
• The main news: for the first time in the company’s history, selling BTC is permitted—up to ~$1.25 billion (about 2.5% of reserves) to cover obligations and fund the buyback. MSTR and STRC reacted with gains.

Conclusion

• The bear market is in an advanced stage, but it seems that the bottom hasn’t yet been reached. Capitulation is underway, sentiment is at a low point, BTC is at a key level—but there’s no inflow yet.
• Historically, the market has never truly bottomed out in summer. A more likely scenario is sideways trading or continued downward pressure through September–October.
• Key triggers: labor market data on Thursday (postponed due to July 4), BTC holding above $58k, and STRC’s behavior after the new framework.
• A bullish scenario would require cooling down AI trading and a reversal of flows into ETFs. Neither has happened yet.