US Bitcoin demand has now been negative for 78 consecutive days, a record. Citadel Securities, meanwhile, says July’s violent selloff reset the equity bull market rather than ended it.
Both claims can be true at once. American speculative money did leave the market in July, but almost none of it has landed in Bitcoin.
Citadel Says July Flushed Out the Speculators
Scott Rubner, Head of Equity and Equity Derivatives Strategy at Citadel Securities, reads July as a rotation problem rather than a deterioration problem. Crowded trades unwound while the underlying bid held.
Retail investors flipped from buyers to sellers. The last week of July produced the heaviest retail equity selling since 2022, per Citadel Securities data.
Technology took the hit. Retail sold more tech notional in one week than at any point since January 2019. That beat the prior record by over 80%. A comparable Big Tech selloff dragged crypto lower in June.
Leverage drained alongside it. Leveraged exchange-traded fund (ETF) assets fell more than $60 billion from their June peak. Semiconductor products alone shrank nearly 55% in a month.
“July did not change the structural bull market. It reset it,” Rubner wrote that in the firm’s August note, arguing positioning has normalized.
He expects roughly 85% of the S&P 500 by weight to be clear to buy back stock by mid-August.
US Bitcoin Demand Has Been Absent for 78 Straight Days
Meanwhile, Bitcoin has not participated in that reset. CoinGlass data puts the Coinbase Premium Index, a gauge of American buying appetite, negative for 78 consecutive sessions at roughly -0.1145%.
The index tracks how far Bitcoin’s price on Coinbase sits below other large venues. A persistent discount means US bids are thin. The previous record ran 40 days, set between January and February.
The timing explains a lot. US retail spent the second quarter chasing artificial intelligence trades, not Bitcoin.
Tech equities gained 43.5% in the second quarter and the Nasdaq 100 rose 27.7%, while Bitcoin fell 13.4%, according to NYDIG research. Spot Bitcoin ETFs bled $4.9 billion over the same stretch. That is where the US Bitcoin demand drought began.
July’s chip liquidation should have freed that capital. It has not reached Coinbase order books.
NYDIG Warns the Bounce Rests on Leverage
Fund flows look healthier than the spot picture. Farside Investors confirmed a $265.4 million outflow on July 31, and SoSoValue estimates roughly $170 million returned on August 3.
NYDIG argues that recovery is hollow. The firm sees positive funding and rising open interest near cycle lows. Neither ETF flows nor stablecoin supply confirm it.
“a troubling setup for a liquidation-driven leg lower, not a durable bottom”
That is the bear case against Rubner. Leveraged traders are rebuilding risk while the cash buyers who confirm a bottom stay out. It echoes the weak conviction in July that on-chain analysts flagged.
BTC price near $63,859 leaves Bitcoin up 2.2% over 24 hours and 1.6% across 30 days. Its market capitalization sits near $1.28 trillion.
Citadel expects buybacks and earnings to lift equities into mid-August. Whether any of that capital finds its way back to American Bitcoin bids is the more useful question now.