BEARISH 📉 : Bitcoin drops 11.6% this week; QCP says bottom not in yet
QCP says Bitcoin slid ~11.6% on the week into June 8. A “double compression” hit from crypto deleveraging and macro headwinds.
The trigger was symbolic. Strategy disclosed a sale of 32 Bitcoin in late May to fund preferred dividends. Tiny size, big signal. It challenged the “never sell” pillar that has underpinned demand since 2020, QCP notes in its June 3 report and Market Colour update.
Macro turned the screw. Oil rose on Middle East risks and stalled US–Iran talks, keeping the Hormuz premium in place since February. Strong US job openings cut confidence in near-term Fed cuts. Higher-for-longer rates hurt high-beta assets like Bitcoin, QCP writes in its report and update.
Options signaled defense, not capitulation. 30D ATM implied vol repriced to ~41.4, up 4 vols on the day and 7 on the week. Realized vol caught up. The skew showed strong demand for downside protection. Front-end was mildly inverted. Risk reversals stayed deeply negative, per QCP’s report.
Hedging got pricier. “Less ‘buy the dip’ and more ‘please insure the dip before discussing it,’” QCP wrote. Richer vol raises the cost of protection and discourages fresh longs from risk-managed institutions, the firm said in its note.
Cross-asset flows didn’t bail crypto out. Equities held up on AI earnings, with hyperscalers and semis leading. Capital concentrated in mega-cap tech and a pipeline of large AI IPOs into early Q3. QCP cites Arthur Hayes’ exit from HYPE and NEAR as an example of that rotation, per its report.
Bottom line from QCP. Not panic. Not bargain hunting. The market waits for clearer signals on Iran, the Fed, or the AI IPO calendar. Until then, the path of least resistance skews lower, the firm concludes in its update and report.