Bitcoin faces $70K test as Hyperliquid USDC inflows rise 8%

Bitcoin was trading near $70,000 as on-chain analytics showed market sentiment in an extreme fear reading this week. CryptoQuant data indicated more than 45% of short-term holders were holding positions below their cost basis and the Coinbase Premium Index fell to about -0.17, a more than three-month low. Spot Bitcoin ETFs recorded net outflows of roughly $1.4 billion over the same period, and DeFiLlama tracked more than $2 billion in stablecoin withdrawals from the broader market.

On-chain counts show Hyperliquid’s USDC balance rose about 8.25%, an increase of more than $500 million that brings the platform’s USDC holdings to over $8 billion. The HYPE/BTC ratio climbed more than 10% in the past week, and Hyperliquid posted a 63% relative gain versus Bitcoin in the second quarter. Hyperliquid’s USDC deposits earn yield under an arrangement with Circle, and a portion of revenue is allocated to platform buybacks, according to on-chain analysts. Those analysts estimate potential additional buyback funding near $700,000 per day.

Traders recorded more than $10 billion in liquidations this week. Analysts tracking order books report substantial liquidity clusters both above and below current prices, with $70,000 cited as a key support level. Data show stablecoin supply shifted away from the general market while a concentrated pool of USDC accumulated on Hyperliquid.

Market participants are watching whether Bitcoin holds the $70,000 level and whether Hyperliquid’s USDC concentration continues to grow, both of which are being monitored for their effects on liquidity distribution and short-term price activity.