Hardcore bitcoin purists aren’t panicking despite the world’s largest digital currency losing nearly 17% of its value last week. That was its worst weekly performance since July 2024, wiping out about $200 billion in market cap in just seven days. The prominent bitcoin advocates, often called maximalists or maxis, argue the real issue isn’t bitcoin itself. They believe capital is simply being sucked out of crypto and into artificial intelligence. This creates what they see as a temporary liquidity crunch rather than a fundamental problem with bitcoin.
The price currently hovers below $60,000, down about 27% over the past month and more than 50% from its all-time high in early October, according to CoinDesk data. The capital flight coincided with a record-breaking losing streak for U.S. spot bitcoin ETFs, which suffered $3.45 billion in outflows over 11 consecutive sessions. Meanwhile, Wall Street’s appetite for tech remains strong. Even after a recent pullback, AI-related equities are still among the market’s strongest performers. The Nasdaq rose 34%, and the S&P 500 climbed nearly 24% in the last year. That has raised anxiety among crypto investors looking for answers about bitcoin’s underperformance.
The AI Capital Rotation
Some market observers view the drop as a loss of structural confidence, but bitcoin maxis disagree. They argue the slump is merely speculative capital rotating heavily into AI. Mati Greenspan, a market analyst and founder of Quantum Economics, told CoinDesk that bitcoin is not facing a bitcoin problem but a liquidity problem. “AI has become the market’s new obsession, but obsessions fade,” he said. Strategy Chairman Michael Saylor echoed that sentiment on X. “Capital markets are funding the AI buildout at historic scale: ~$400B over six months,” Saylor wrote. “Bitcoin ETFs have seen ~$4B of outflows since May 14, pressuring BTC. This is a capital rotation, not a bitcoin impairment. Volatility creates opportunity.”
Greenspan pointed to Anthropic’s $50 billion IPO, targeting a nearly $1 trillion valuation, as a clear sign of where market liquidity has gone. While bitcoin advocates highlight the asset’s historical long-term returns, traditional liquidity pools are currently chasing AI infrastructure, data centers, and multi-billion-dollar private capital rounds. The anticipated IPOs of OpenAI, Anthropic, and SpaceX, which together could raise more than $200 billion, may be drawing investor attention away from crypto.
Not Everyone Blames AI
Bitcoin core developer and maximalist Jameson Lopp argued that frustration during market downturns often fuels the search for simple explanations. “I suspect the root cause is the bear market, combined with TradFi markets experiencing an AI boom,” Lopp said on X. However, not everyone is convinced AI is the primary driver. Jason Fernandes, a market analyst and co-founder of AdLunam, said bitcoin is facing pressure from multiple fronts. “ETF outflows, high interest rates, creeping inflation, money rotating back into hot tech stocks, macro uncertainty, and now the psychological shock of Michael Saylor’s Strategy selling BTC after years of preaching ‘never sell,’” Fernandes told CoinDesk.
Strategy, the largest publicly traded corporate holder of bitcoin, drew criticism after selling 32 bitcoin for $2.5 million in late May. It was the company’s first sale in four years, intended to fund dividend payments on its perpetual preferred stock. Critics claimed the move damaged confidence, but Greenspan dismissed the panic. “Selling 32 BTC against a balance sheet of more than 843,000 BTC is not even a rounding error,” he said.
Time to Buy?
Despite the outflows, some maxis argue it might be a good time to buy. They point to bitcoin’s longer-term fundamentals remaining intact. Greenspan noted that the recent outflows from bitcoin funds are likely part of a rotation back toward monetary assets. He added that bitcoin’s current consolidation phase could serve as an accumulation zone if network fundamentals hold. Institutional adoption, regulatory frameworks, and discussions around bitcoin as a strategic reserve asset have continued to mature over the last few years. Strike CEO Jack Mallers has encouraged investors to buy the dip on social media.
However, a rotation back into crypto is not guaranteed to be smooth. Greenspan warned that if AI sentiment cracks, bitcoin could get hit twice: first from liquidity leaving crypto, and then from a broader risk-off move across markets. “As for what comes next, I would be careful assuming the bottom is already in,” he said. Bitcoin isn’t crashing because of Saylor, but it may be losing the momentum trade.
