Bitcoin’s $10 billion liquidation wave reveals why the AI boom is hurting crypto
Bitcoin’s drop toward $60,000 reflected two forces: a broad rotation of speculative capital toward AI and private tech deals, and a buildup of leverage in crypto derivatives. Bitcoin fell nearly 14% in a week, triggering almost $10 billion in liquidations of long futures as crowded bullish positions were forced out. It later rebounded to around $63,000, but pressure remained as ETF inflows weakened and hedge funds reduced exposure. Market research points to AI as Bitcoin’s main competitor for growth-oriented capital. Investors have been shifting toward AI-linked stocks, data-center infrastructure, and expected future tech listings, drawing liquidity away from crypto. At the same time, futures open interest had risen again after earlier declines, making the market vulnerable once prices turned lower. Funding rates moved toward negative, signaling the long bias was unwinding. The selloff may have cleared some leverage, but it does not confirm a bottom. A stronger recovery would likely require stable open interest, calmer funding, and renewed spot demand.
