Prediction market traders are increasingly betting that bitcoin’s correction is far from over, even after the cryptocurrency tumbled toward $65,000 this week amid mounting pressure from ETF outflows and weakening institutional demand.
On Kalshi, traders are currently assigning a 66% probability of bitcoin falling below $55,000 this year and a 50% probability of prices below $50,000. They also give a 31% chance that prices could even dip below $40,000.
Polymarket traders express a similar view. Contracts on the platform imply about a 67% probability that bitcoin will fall below $55,000 this year, and a higher chance that it will fall below $50,000.
On prediction platform Polymarket, traders now give bitcoin only a 30% chance of outperforming gold in 2026. Gold is down about 1.5% in the last month, but is up 33% in the last year, while BTC is down around 37%.
This comes amid waning institutional appetite for the leading cryptocurrency. According to data from SoSo Value, traders pulled $2.4 billion from US-listed BTC ETFs in May and $1 billion in the first two trading days of June, as record outflows continue.
Meanwhile, K33 Research claims bitcoin is also losing a battle for investor attention to artificial intelligence-related stocks. As CoinDesk previously reported, the firm said in a report on Tuesday that many investors see the opportunity cost of holding bitcoin as too high, while AI-linked companies continue to post big gains and major stock indexes push to record highs.
“Much of the market sees the opportunity cost of holding BTC as too high while everything AI-related goes up,” K33’s Vetle Lunde wrote.
While K33 still views bitcoin as undervalued relative to equities in the long term, the prediction markets suggest that traders are increasingly positioning for lower prices ahead of a recovery.
While traders are increasingly betting on lower bitcoin prices, capital doesn’t seem to be leaving crypto entirely. Instead, it is increasingly moving to digital dollars.
USDT and USDC have both gained market share during bitcoin’s drop to $66,000, CoinDesk previously reported, a sign that traders are raising money and waiting for better opportunities rather than immediately buying the plunge.
