Live markets: Bitcoin, ether lead $1 billion liquidation losses as AI trade keeps going

A liquidation flush took bitcoin to its lowest since early June before Micron's blowout earnings and SK Hynix's U.S. listing plans steadied the AI trade that crypto had been sliding alongside.

Bitcoin briefly fell below $60,000 during the US trading session, coinciding with $469 million in net outflows from US spot Bitcoin ETFs. This marked the 30th largest single day redemption since the ETFs launched in January 2024.

As a result of the consistent outflows for the past few months, cumulative net inflows remain at $52.8 billion, a level last seen on 14 July 2025, although this is approximately $2.3 billion below the peak reached a few days later.

The U.S. two-year Treasury yield is on the cusp of a significant technical breakout.

Highly sensitive to near-term interest rate expectations, the two-year yield is testing the descending trendline that has capped its decline since the October 2023 peak of 5.26%.

A decisive move above this trendline would mark a classic bullish breakout for yields, signaling potential for further upside.

Such a development would imply tighter financial conditions, likely supporting a stronger U.S. dollar while exerting downward pressure on risk assets, including bitcoin and equities.

Brent crude fell below $72.48 a barrel on Thursday, wiping out every gain made since the U.S.-Iran war began, as tankers resumed open passage through the Strait of Hormuz and oil markets flooded with supply.

West Texas Intermediate traded near $69.

Cheaper oil eases the inflation pressure that pushed the Fed hawkish in the first place, and a sustained drop could eventually shift the rate outlook that has weighed on bitcoin all month.

The chain runs oil lower, then inflation softer, then Fed less hawkish, then risk assets get room to recover. But that sequence works with a lag of months, not days, so the oil move is a tailwind in the making rather than one that's arrived.

Aave's AAVE token climbed about 15% in the past 24 hours to around $80, its sharpest single-day move in months, after Standard Chartered initiated coverage with a $3,500 price target for end-2030 - or roughly 50 times more than where the token traded when the note landed Wednesday morning.

The call comes from Geoff Kendrick, the bank's global head of digital assets research, who also put a $100 target on Uniswap's UNI token last week.

His Aave thesis is that the protocol will recover its dominant position in decentralized lending as the broader DeFi market grows, with assets across the sector projected to expand roughly 37 times by 2030.

AAVE reaching $180 by year-end before climbing in stages to $600, $1,200 and $2,200 over the following three years, Kendrick said.

The protocol has had a rough stretch, however.

A $291 million exploit at lending platform KelpDAO in April spilled into Aave, triggering a liquidity crunch that cut deposits from $44 billion to about $23 billion and pushed Aave's share of the DeFi lending market from a 59% average down to 38%.

Meanwhile, the target depends on steps that have not happened yet.

Aave Horizon, the protocol's push to bring traditional finance firms onchain as borrowers, is central to Kendrick's model but unproven.

AAVE's all-time high is $661, set in 2021, meaning the 2030 target requires the token to go five times past levels it has never reached. Kendrick's UNI target drew some criticism this week over its methodology, and the same scrutiny applies here.

Bitcoin dropped to $59,175 overnight, its lowest point since early June, before recovering to about $61,500 by Thursday morning, per CoinDesk data. Nearly $1 billion worth of futures positions were liquidated across crypto majors, such as bitcoin, ether, solana, and others, to tokenized versions of stocks, such as Micron Technology Inc (MU) and Sandisk (SNDK).

The dip triggered roughly $430 million in long liquidations on bitcoin-tracked futures, or bets on higher prices that were automatically closed as the price fell.

No single catalyst drove the move. Bitcoin has lost about 10% since Monday's peak near $65,500, pulled lower by the same forces that have dominated all week: a hawkish Fed, six straight weeks of ETF outflows, thinning summer liquidity, and a quarter-end options expiry on June 30 that traders say is keeping the market unstable.

Major market-maker Wintermute had flagged $59,000 as the bear-market low to watch in its Tuesday's note.

The bounce came from outside crypto. Micron Technology reported quarterly earnings after the close that shattered analyst estimates, sending its shares sharply higher and lifting the broader memory chip complex.

SK Hynix separately disclosed plans for a U.S. stock listing seeking roughly $29 billion, one of the largest offerings ever. Samsung and Kioxia rallied in Asia Thursday morning.

The same AI chip trade that sent the Kospi down 10% on Monday on fears the spending boom was stalling is now the thing steadying crypto, with Micron's results reading as confirmation that demand for AI memory is structural, not speculative.

The quarter-end remains the week's live risk. Bitcoin's $59,000 low held, but $1.6 billion in leveraged long positions sit clustered below $58,000, per CoinGlass, meaning a break there would accelerate the drop.

Thursday's PCE inflation print, the Fed's preferred price gauge, is the next data point that could move the market in either direction.

In May, combined exchange volumes fell 3.45% to $4.41T; the lowest since September 2024. RWA perpetual futures volumes rose 10.4% against the trend, hitting a new all-time high.

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