Bitcoin prices continued to hit all-time highs in mid-December, approaching 110,000 before heading lower. It then fluctuated between 100,000 and 93,000. At the same time, technology giants performed poorly, driving U.S. stocks lower. The Bitcoin ETF also faced a net outflow of nearly 90 million magnesium. Some analysts pointed out that during the period of Bitcoin’s decline, the narrative of AI and high-performance DeFi was attracting market liquidity.
(The crash of technology giants drags down U.S. stocks, and Bitcoin spot ETFs face capital outflows)
Bulls reverse, Bitcoin ETF continues net outflows
According to SoSoValue data, the Bitcoin ETF has maintained net outflows since December 19, and last week only saw a net inflow of 475 million magnesium on December 26. Comparing the daily trend of BTC/USDT, we can find that after hitting a record high of 108,353 on December 17 (Binance spot data), the daily line closed a cross star, which usually represents a reversal of the trend (short parties suppress long parties). The decline also continued on the 18th and 19th, and the Bitcoin ETF also began to have net outflows.
Investors are paying attention to altcoins and emerging narratives
According to reports, Bitget chief analyst Ryan Lee said: "Artificial intelligence-driven investment and high-performance DeFi platforms are becoming the next investment hotspot." The targets named in the report are Hyperliquid and ai16z, with the former claiming to have no VC or market maker participation. The banner of maintaining relationships with the community became one of the most successful projects in the second half of the year. In addition to being a DEX, it has also started to build its own EVM public chain, pushing the narrative and price to a high point, reaching a historical high of 35 mg.
(Reviewing this year’s most successful airdrop: Why has Hyperliquid become a textbook on narrative and token economics?)
The latter is a fund invested by Marc Andreessen, co-founder of a16z, a well-known venture capital firm that spans Web2 and Web3. Interestingly, the ai16z fund is managed by AI.
(a16z personally goes to sea to trade memes AI16Z? Venture capital supports the AI meme coin craze)
Will a stronger dollar lead to a reduction in liquidity and an early end to the bull market?
Reports indicate that during Bitcoin’s decline, investors are turning their attention and liquidity into altcoins and these emerging narratives. Ruslan Lienkha, head of markets at YouHodler, said: “While market conditions for emerging technologies and decentralized platforms provide exciting opportunities for investors, the strength of the U.S. dollar has put pressure on digital asset prices.”
And added: “Higher interest rates in the long term will make bonds and U.S. Treasuries more attractive to capitalists and push up the value of the U.S. dollar.” “Conversely, higher interest rates will reduce the available liquidity of risky assets such as Bitcoin, leading to Cryptocurrency markets saw reduced inflows and even net outflows.”
This article Bitcoin ETF saw net outflows for many days, analysts: When Bitcoin fell, investors were paying attention to emerging trends such as Hyperliquid and ai16z first appeared on Chain News ABMedia.
