Bernstein said Bitcoin’s increasingly diversified investor base continues to support its long-term store-of-value thesis.
The Wall Street broker argues that Bitcoin’s recent weakness is being driven primarily by softer capital inflows, rather than concerns such as quantum computing risks or other structural threats.
Worries about future quantum computing advances—which could theoretically compromise Bitcoin’s cryptographic security—have resurfaced in market discussions, particularly after Google research suggested the computing power required to challenge blockchain systems may be lower than previously assumed.
Bernstein noted that Bitcoin treasury companies and spot ETFs have attracted about $12 billion in inflows so far in 2026, a sharp decline from roughly $60 billion in 2025. ETFs alone have recorded around $2.6 billion in net outflows from a $75 billion asset base, with most of the remaining demand coming from corporate buyers led by Strategy.
The analysts attributed the slowdown largely to retail investors rotating into AI-related opportunities, pointing out that some of the strongest-performing areas in crypto this year have been tied to tokenized equities and commodities.
Still, they wrote, “Bitcoin still may offer some diversification from the unusual singular AI driven momentum markets we have experienced this year.”
Bernstein also viewed the relatively limited ETF outflows as constructive, suggesting Bitcoin ownership is becoming less dependent on short-term, momentum-driven retail flows.
Bitcoin has been under pressure in recent months, sliding from around $82,000 in early May to about $63,000 today, a drop of more than 20%. It briefly fell below $60,000 last week—its lowest level since October 2024—and remains roughly 50% below its October 2025 peak near $126,000.
The decline has been linked to ongoing ETF outflows, weaker risk appetite, and a broader shift of capital toward AI-driven equities and high-profile equity offerings.
Unlike earlier cycles dominated by retail speculation, today’s market includes ETFs, corporate treasuries, wealth managers, pension funds, and sovereign investors, creating a more diversified and potentially more stable structure.
While Bitcoin has lagged AI-related market momentum this year, Bernstein argued that its quieter performance does not weaken the long-term investment case and may instead reflect a healthier market structure.
Citing Citi research, spot Bitcoin ETF flows are estimated to account for roughly 45% of weekly price movements, underscoring their importance as a key demand indicator.
At the time of writing, Bitcoin was trading near $62,600.
