Wintermute said Bitcoin’s latest rally has failed its first major macro test, arguing that the move was driven more by leverage and short covering than by durable spot demand. In its May 18 market update, the trading firm pointed to hot inflation, rising Treasury yields, ETF outflows and renewed rate-hike pricing as the backdrop behind a sharp reversal across digital assets.
Rates responded quickly. The 10-year Treasury yield rose 28 basis points on the week to 4.58%, its highest level since September 2025, while fed funds futures erased all expected cuts for 2026 and began pricing a 44% chance of a rate hike by December, up from 22.5% a week earlier. Wintermute said the market narrative shifted from “when do they cut” to “do they hike” in only five trading days.
That repricing hit long-duration assets. Wintermute said 20-year-plus Treasuries fell 2.8%, while gold dropped 3.8% despite the geopolitical backdrop. Brent crude rose 8.6%, leaving the firm to conclude that “the only things that worked were the things causing the problem.”
Why $75,000 Bitcoin Is The Line In The SandEthereum underperformed even more, falling 10.2% on the week. Wintermute said ETH continued to weaken across both spot and derivatives markets, with ETH/BTC pressing 0.0275, funding softer and relative implied volatility elevated. The firm described ETH as the “wrong asset for this macro.”
“When leverage is the marginal buyer, the unwind is fast,” Wintermute wrote.
The firm said Bitcoin remains below its 200-day moving average near $82,200 after being rejected five times this month. The immediate support zone is $76,000 to $78,000, according to the update, while a break of $75,000 could open the way toward $70,000 to $72,000.
Wintermute did not dismiss the broader structural case for Bitcoin. It noted that exchange reserves remain near multi-year lows, long-term holders are still accumulating, and the CLARITY Act continues to move forward after clearing the Senate banking committee. The firm also said tokenized Treasuries reached $15 billion onchain, describing the segment as an area of continued growth.
Still, Wintermute argued that short-term flows matter more than the structural story for now. “The flow data shows institutions used the rally to take profit rather than add, and in the short term that matters more than the structural story,” the firm wrote.
The next test, according to the update, is whether Bitcoin can hold the $76,000 to $78,000 area through Nvidia earnings on Wednesday, May 20. A hold would “rebuild some confidence,” Wintermute said, but a break below $75,000 with funding resetting and ETF flows negative could bring the low $70,000s back into view quickly.
At press time, BTC traded at $77,297.
