Wintermute flagged a significant divergence between equities and digital assets, with the S&P 500 posting its eighth consecutive week of all-time highs while cryptocurrency failed to capitalize on improving macroeconomic conditions. The U.S. 10-year Treasury yield declined to 4.5% following de-escalation rhetoric around Iran, typically a catalyst for risk-on asset flows, yet Bitcoin and broader crypto markets remained muted.
Institutional buying that had propelled Bitcoin from $70,000 to $80,000 has deteriorated sharply, evidenced by withdrawals exceeding $2 billion from Bitcoin ETFs over the past two weeks. Nvidia's exceptional earnings—with Q1 revenue of $81.6 billion (up 85% year-over-year), a Q2 guidance of $91 billion, and $80 billion in planned share buybacks—failed to sustain post-earnings momentum, suggesting markets have already priced in artificial intelligence upside scenarios. The crypto underperformance extends to Ethereum, with the ETH/BTC pair trading at 10-month lows, down 35% from August peaks.
Hyperliquid (HYPE) emerged as the sector's lone bright spot, recording a single-session inflow of $25.5 million into its ETF while Anchorage-linked wallets accumulated 2.38 million HYPE tokens ($135 million) over five weeks. Bitcoin's critical support zone sits at $75,000–$76,000; holding this level could reignite rallies toward $80,000-plus, while a breakdown opens a path to $70,000–$72,000.
Wintermute's core assessment underscores a diverging narrative: equities rally while crypto consolidates. Absent a return of institutional capital to digital asset ETFs, downside pressure on cryptocurrencies is likely to intensify.