Bitcoin flat near $64,000 as equities hit records, Tether shrinks $4B

Bitcoin traded little changed near $64,000, up 0.16% since midnight UTC, even as global equities hit record highs on AI optimism and progress toward reopening the Strait of Hormuz.

"Institutional and retail interest in crypto as an investment has cooled as AI absorbs a disproportionate share of capital and attention; most sectors, not just crypto, have underperformed AI over the past year," DWF Labs wrote in a report.

MSCI's All Country World Index rose 0.4% toward another record close, its Asia Pacific benchmark gained 2.2%, and Australian shares hit a new peak after the S&P 500 and Dow Jones Industrial Average closed at all-time highs Tuesday. The broader CoinDesk 20 is unchanged since midnight, with 11 components rising and nine declining. U.S. spot bitcoin ETFs recorded $5.4 billion of net outflows in the first half of the year as capital rotated into AI-linked assets.

Today's direction may hinge on U.S. employment figures and ISM services PMI due later, while a $4 billion contraction in Tether's market value over 60 days suggests capital is leaving the system, according to CryptoQuant.

Derivatives positioning stays subdued in majors

The crypto futures long/short ratio remains bearish, with shorts accounting for 51% of taker volume, slightly better than the recent 52/48 split in favor of the bears. There is little action in bitcoin and ether futures.

PUMP is the best-performing top-100 token over the past 24 hours, up 115%. The surge lifted open interest 9% to 84.76 billion tokens, though that tally is not new. Other open-interest gainers include XLM, ZEC and BNB, while SHIB, HBAR and LTC saw declines that likely reflect capital outflows.

ZEC and BTC bulls boast positive 24-hour open-interest-adjusted cumulative volume delta, the highest among majors, suggesting long traders are using market orders rather than passive limit orders. On the opposite end are XLM and DOGE. XLM also stands out for a notably negative annualized perpetual funding rate of -23%, reflecting a growing bearish bias.

Bitcoin's 30-day implied volatility index remains around 36%, a level from which it has tended to bounce sharply, and ether's EVIV shows the same pattern. In Deribit-listed options, bitcoin and ether volume rankings continue to feature call options, while OTC desk Paradigm featured bearish ether risk reversals.

Tether's $4 billion contraction flags late-stage selling

Tether's market cap has shrunk by $4 billion over 60 days, one of the steepest contractions on record, according to CryptoQuant. USDT's supply expands when new money enters crypto, since dollars get converted into the stablecoin to buy other tokens, and shrinks when the flow reverses.

CryptoQuant frames the drop as near exhaustion, noting the market's deepest USDT contraction phases have historically lined up closer to points where selling pressure was running out than to the start of another leg down. Past troughs this deep, in early 2023 and mid-2026 on the same gauge, preceded bitcoin recoveries.

The chart cuts both ways. USDT supply contracting alongside a bitcoin that has gone sideways since May is also a plain read on demand drying up. A contraction marking a bottom holds only once the supply turns back up, and it hasn't yet. If the 60-day change climbs back toward zero, fresh dollars are entering; if it keeps sinking, the money is still leaving.

This article is for informational purposes only and does not constitute investment advice.