Prediction market traders are increasingly betting that bitcoin’s correction is far from over, even after the cryptocurrency fell to $65,000 this week amid growing pressure from ETF outflows and weakening institutional demand.
At Kalshi, traders currently assign a 66% chance of bitcoin falling below $55,000 this year and a 50% chance of prices falling below $50,000. They also give a 31% chance that prices could even fall below $40,000.
Polymarket traders express a similar opinion. Contracts on the platform imply a roughly 67% chance that Bitcoin will fall below $55,000 this year and an even higher chance that it will fall below $50,000.
On the Polymarket prediction platform, traders now give Bitcoin just a 30% chance of overtaking gold in 2026. Gold is down about 1.5% in the last month, but up 33% in the last year, while BTC is down about 37%.
This comes amid dwindling institutional appetite for the leading cryptocurrency. According to data from SoSo Value, traders withdrew $2.4 billion from US-listed BTC ETFs in May and $1 billion in the first two trading days of June, with the record outflow continuing.
Meanwhile, K33 Research argues that bitcoin is also losing the battle for investors’ attention to AI-related stocks. As CoinDesk previously reported, in a report on Tuesday, the company said that many investors consider the opportunity cost of holding bitcoin too high, while AI-linked companies continue to post outsized profits and major stock indexes hit record highs.
“Much of the market sees the opportunity cost of holding BTC as too high while everything AI-related skyrockets,” K33’s Vetle Lunde wrote.
While K33 still views Bitcoin as undervalued relative to stocks over the long term, prediction markets suggest traders are increasingly positioning themselves for lower prices before any recovery arrives.
While traders are increasingly betting on lower bitcoin prices, capital does not appear to be abandoning cryptocurrencies entirely. Instead, it is increasingly moving towards digital dollars.
Both USDT and USDC have gained market share during bitcoin’s decline to $66,000, CoinDesk previously reported, a sign that traders are raising cash and waiting for better opportunities rather than immediately buying on the dip.
