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Why the 4.1% PCE inflation print just turned crypto into a high beta risk asset

Why the 4.1% PCE inflation print just turned crypto into a high beta risk asset

The digital asset landscape is currently grappling with a severe wave of selling pressure that has pushed major cryptocurrencies to multi-month lows. This downturn stems from a combination of deteriorating macroeconomic conditions, heavy institutional redemptions, and an intense cascade of derivatives liquidations.

Bitcoin has dropped 2.01 per cent over the past 24 hours to trade at US$59,782.21, closely tracking a broader market contraction of 1.85 per cent. Ethereum has suffered an even steeper decline, falling 3.46 per cent to US$1,567.16 and underperforming the market leader. Together, these movements have pulled the total cryptocurrency market capitalisation down by 1.76 per cent to a yearly low of US$2.06T.

The primary driver behind this market-wide reset is a sharp shift in macroeconomic sentiment, highlighted by an unexpected U.S. Personal Consumption Expenditures inflation reading. The inflation metric printed at 4.1 per cent, marking a three-year high. This hotter-than-expected data has reignited fears of a prolonged period of restrictive monetary policy, with market participants quickly increasing bets on further Federal Reserve interest rate hikes. Because the cryptocurrency market shares an 88 per cent correlation with the S&P 500 index, digital assets are behaving as highly sensitive risk assets within a tightening global liquidity environment.

This macroeconomic pressure quickly translated into physical selling across institutional channels. U.S. spot Bitcoin exchange-traded funds recorded their largest single-day redemption since early June, with investors pulling US$469.08M from these products on Wednesday, June 24. This massive exit represents the fifth consecutive day of net institutional outflows, led primarily by BlackRock and its spot product, which accounted for a significant portion of the capital flight.

At the same time, spot Ethereum funds experienced US$30.24M in net redemptionson the same day. This persistent drain on institutional liquidity has removed a critical layer of price support and created automated selling pressure as fund managers liquidate their underlying digital holdings to meet redemption demands.

Beyond institutional product outflows, the spot market faced unexpected structural headwinds from major trading platforms. Rumours and reports began circulating across social networks that prominent global exchanges, specifically Binance and Coinbase, were actively offloading large quantities of Bitcoin. This potential institutional distribution added to an already significant supply overhang, shaking retail investor confidence and accelerating the downward price action.

As spot prices cracked, the decline triggered a violent mechanical unwinding in the derivatives market, which drastically amplified the velocity of the sell-off. Over a 24-hour window, forced liquidations across the entire cryptocurrency market surpassed US$1B. Leveraged positions linked directly to Bitcoin accounted for US$428.87M of this total, with long positions making up US$337M of the wiped-out contracts. Over the final 12 hours of the crash, short positions accounted for 63 per cent of the immediate liquidations.

Meanwhile, over-leveraged traders in the Ethereum market saw US$230M in contracts forcibly closed. Despite this massive purge of speculative bets, average funding rates remarkably managed to stay positive, confirming that many market participants were caught off guard in heavily leveraged long positions.

This severe deleveraging event has pushed technical indicators into deep underbought territory. Ethereum broke decisively below both its seven-day simple moving average of US$1,675.94 and its 30-day simple moving average of US$1,760.28. Its Relative Strength Index has dropped to 30.5, which confirms deeply oversold conditions but offers no immediate structural support. For the broader market, the overall capitalisation sits precariously at its US$2.06T baseline, with a global Relative Strength Index of 35.89 suggesting that while the market is stretched to the downside, a definitive bullish reversal has not yet commenced.

Looking ahead, the immediate trend for the digital asset space remains distinctly bearish, though the market is rapidly approaching a massive technical inflection point.

 

 

Source:

https://e27.co/why-the-4-1-pce-inflation-print-just-turned-crypto-into-a-high-beta-risk-asset-20260626/

 

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Bitcoin at US$63,386: The geopolitical storm Wall Street missed

Bitcoin at US$63,386: The geopolitical storm Wall Street missed

Bitcoin currently trades at US$63,386.87 after experiencing a 1.24 per cent decline over the past 24 hours. This downward movement mirrors a broader one per cent contraction in total cryptocurrency market capitalisation. These short-term price fluctuations are predictable reactions to external macroeconomic shocks rather than systemic failures.

The current sell-off lacks any crypto-specific negative catalyst. Traditional institutional selling pressure and escalating global tensions dictate the immediate price action. We must separate the fundamental progress of distributed technology from the temporary noise of global political theatre.

The primary catalyst driving this risk-off sentiment is the collapse of ceasefire negotiations between the United States and Iran over the weekend. New military warnings from United States President Donald Trump and Tehran’s subsequent decision to close the Strait of Hormuz again severely shook recent optimism about technology. This geopolitical friction immediately triggered a reversal across global equity and commodity markets. United States equity futures fell sharply following the Juneteenth holiday.

S&P 500 futures dropped 0.5 per cent while Nasdaq 100 contracts declined 0.7 per cent. Asian markets reflected this same anxiety. The Japanese Nikkei 225 opened slightly lower at 71,067.15, then fluctuated up to 72,133.88 as overnight futures provided local support. South Korea’s KOSPI dropped more than 1.1 per cent in morning trading, with chip giant Samsung Electronics leading losses, sliding over three per cent. Australia ASX 200 also slumped early as investors digested weekend energy transport disruptions. Heavyweight BHP faced a steep sell-off following massive cost overruns. Bitcoin simply reacts to this same global liquidity contraction.

Commodity and currency markets highlight the exact nature of this macroeconomic stress. Crude oil surged amid severe supply chain anxiety. Brent crude rose over one per cent to top 81.50, and West Texas Intermediate jumped nearly three per cent to trade near 78. This energy shock strengthens the US against most major currency peers as investors seek safe-haven assets. The British Pound weakened 0.2 per cent on widespread speculation that United Kingdom Prime Minister Keir Starmer might resign following political defeats. Investors clearly demand stability.

Beyond immediate geopolitical triggers, markets also brace for the crucial United States Core PCE inflation release on Thursday. The Federal Reserve under new Chair Kevin Warsh recently executed a hawkish pivot. Policy paths now hint at potential 2026 interest rate hikes. This traditional financial tightening directly pressures risk assets, including cryptocurrencies. The Nasdaq-100 quarterly rebalance takes effect today. The index added major tech players such as CoreWeave and Rocket Lab while removing legacy firms such as Charter Communications. These structural shifts in traditional equity markets force institutional portfolio managers to rebalance their broader risk exposure, inadvertently dragging digital assets into the sell-off.

We must also address the persistent institutional selling pressure weighing heavily on Bitcoin. United States spot Bitcoin funds recorded a record US$6.35 billion in net outflows over the past 30 days. The daily pace of these outflows recently slowed, but this persistent drain removes a massive source of traditional demand from the market. I maintain that integrating digital assets into traditional financial wrappers introduces legacy market behaviours into our ecosystem.

Traditional financial tests, such as the Howey test, remain entirely unsuitable for evaluating these distributed crypto systems. Regulators fail to understand that digital assets operate on fundamentally different architectural principles. When traditional institutions face geopolitical shocks or margin calls in equity markets, they initially liquidate their most liquid alternative assets. Bitcoin currently absorbs this traditional market fragility. The asset reacts to macro risks and a withdrawal of institutional capital rather than any fundamental deterioration in network activity. This dynamic shows that digital assets remain tethered to the whims of global equity markets until we achieve true decentralisation.

Technical indicators and derivatives data reveal a market structure that remains weak but entirely orderly. Bitcoin currently trades below its seven-day simple moving average of US$63,823 and its 30-day simple moving average of US$64,037. This positioning confirms short-term bearish momentum across all major timeframes. The Relative Strength Index reading of 30.06 shows the asset sits in oversold territory without reaching extreme capitulation levels. The derivatives market provides further clarity on ecosystem health.

Total open interest fell by 4.56 per cent in the last 24 hours, while Bitcoin liquidations dropped by an impressive 46.54 per cent. These numbers signal lower speculative leverage and eliminate the risk of an immediate squeeze. The market unwinds excess leverage in a controlled manner rather than experiencing a chaotic cascade of mandatory selling. This orderly deleveraging creates a healthier foundation for potential recovery. Speculators cleared out weak positions, leaving only dedicated capital in the market to support future price discovery.

Traders examining the near-term market outlook must focus entirely on specific price levels to gauge the next directional move. The critical support zone is at US$63,200, representing the recent 24-hour low. If buyers successfully defend this zone, a rebound toward the swing high resistance at US$64,506 becomes highly probable. The path of least resistance remains downward unless Bitcoin fund flows turn positive.

A definitive break below the US$63,200 support could trigger a quick test of the psychological US$62,000 level. The bias remains neutral to bearish until Bitcoin reclaims and holds above the US$64,500 resistance area. We must also monitor any escalation in the situation in the Strait of Hormuz or sudden reversals in daily Bitcoin fund flows. 

This short-term bearish pressure ultimately tests network resilience and separates fleeting speculative capital from genuine believers in distributed financial infrastructure. We currently stand on the precipice of a truly human-focused, highly practical application layer that transcends legacy market volatility.

 

 

Source: https://e27.co/bitcoin-at-us63386-the-geopolitical-storm-wall-street-missed-20260622/

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

81% correlated with gold: Is Bitcoin just another macro derivative now?

81% correlated with gold: Is Bitcoin just another macro derivative now?

The cryptocurrency market recently experienced a sizable contraction, dropping 2.21 per cent to reach a total capitalisation of US$2.17T over a 24-hour period. This downturn stems primarily from a hawkish Federal Reserve policy update signalling a higher-for-longer interest-rate environment. Wall Street rebounded from the initial Federal Reserve sell-off on Thursday, and technology stocks led the charge.

This dichotomy highlights the complex correlation between macroeconomic liquidity and risk assets. Digital assets maintain an 81 per cent correlation with gold, indicating that both metals and cryptocurrencies currently trade as rate-sensitive macro assets. The market reacts viscerally to reduced expectations for near-term monetary easing, creating a persistent headwind for crypto liquidity.

The Federal Reserve held its benchmark interest rate steady at 3.50 per cent to 3.75 per cent at its latest meeting. The central bank shocked investors by scrubbing cutting bias language from its remarkably brief 130-word statement. The updated dot plot revealed that nine of the 18 officials now project at least one rate hike by the end of 2026. This hawkish pivot forces market participants to price in tighter, data-dependent monetary policy.

The immediate impact was severe on the crypto sector. Bitcoin, which currently commands 58 per cent of the total digital asset market, absorbed the brunt of this liquidity squeeze. Consequently, US spot Bitcoin ETFs recorded US$82 million in net outflows. This institutional retreat underscores a critical reality: traditional finance still dictates digital asset flows. Traders must respect the immediate realities of the global liquidity cycle and adjust their risk models accordingly.

Internal market mechanics exacerbated the downturn beyond the macroeconomic headwinds. High leverage acted as a severe accelerant during this sell-off. The macro contraction triggered a derivatives squeeze, resulting in US$144.29 million in Bitcoin long liquidations over the 24-hour window. This forced selling created a cascading effect that amplified the initial price decline and triggered further automated sell orders across multiple exchanges. I have always maintained that speculative financial activities, including crypto trading and options, resemble gambling, with odds only slightly better than those in traditional casinos. The recent liquidation event perfectly illustrates this dynamic.

The house edge of macroeconomic reality simply wiped out over-leveraged participants who failed to manage their downside risk properly. A pervasive lack of buyer conviction compounds this technical breakdown. The Crypto Market Cap Fear and Greed Index signals deep fear among retail and institutional participants alike, with a reading of 20. The market failed to attract significant dip-buying, proving that sentiment remains highly fragile.

Traditional equity markets demonstrate remarkable resilience and sector-specific momentum while the digital asset space grapples with these liquidity constraints. Major US benchmarks successfully rebounded from the Federal Reserve shock, and technology stocks led the charge, driven almost entirely by an explosion in the sector. The Philadelphia Semiconductor Index skyrocketed 6.4 per cent to achieve a record high.

Intel Corporation was a major driver of this surge, jumping 10.6 per cent following a monumental announcement. President Trump announced a partnership between Intel and Apple to design and manufacture advanced semiconductors domestically. This strategic alignment boosts Intel and secures the domestic supply chain for critical technology infrastructure. Other major technology players joined the rally, with Micron gaining 8.7 per cent, AMD rising 4.8 per cent, Broadcom increasing 4.7 per cent, and Nvidia advancing 2.9 per cent to top the S&P 500 gainers on a points basis. SpaceX fell 3.5 per cent to US$185 during this period.

Market breadth showed softness despite the overall positive sentiment. The Dow Jones Industrial Average edged up just 0.14 per cent, and the Equal-weight S&P 500 gained 0.46 per cent, underperforming the cap-weighted index by 62 bps. Small caps significantly outperformed, with the Russell 2000 surging 2.1 per cent to close at fresh all-time highs. Geopolitical developments also played a crucial role in shaping overnight market sentiment.

President Trump and Iranian President Masoud Pezeshkian achieved a major de-escalation breakthrough when they signed a 14-point interim memorandum of understanding to wind down the conflict in the Middle East. This agreement includes a 60-day window for final negotiations, the immediate removal of the US naval blockade, and the reopening of the critical Strait of Hormuz. This diplomatic success significantly eased global energy-driven inflation anxieties and triggered a massive relief rally for international supply chains. Oil prices tumbled toward three-month lows on the news. Brent snapped a five-day losing streak by settling the session up 0.7 per cent at US$79.25. Prices sit back to early March levels and show a 30 per cent year-to-date gain, reflecting the immense volatility inherent in global energy markets.

Currency markets experienced turbulence, and the yen weakened to its lowest level against the dollar in almost two years, raising the risk of Japanese intervention. Markets repositioned following the hawkish Federal Reserve hold, and futures fully priced in a rate hike by October. JPMorgan strategists warn that rising volatility in semiconductors increases the risk of market tantrums driven by variance-driven selling.

Looking ahead, the immediate technical test for the cryptocurrency market centres on the US$2.17T pivot point. A failure to hold this level could initiate a slide toward the US$2.2T mark, which aligns with the 78.6 per cent Fibonacci retracement, and potentially test the yearly low of US$2.1T. The US Senate prepares to mark up the CLARITY Act, which could provide much-needed regulatory clarity for digital assets. Traders must also monitor the July 1 enforcement of the European Union Markets in Crypto-Assets regulations for directional cues. The US market will close tonight for Juneteenth National Independence Day, likely reducing liquidity and increasing volatility across all trading venues.

 

 

Source: https://e27.co/81-correlated-with-gold-is-bitcoin-just-another-macro-derivative-now-20260619/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j