Cboe Dispersion Index Hits 42 as Bitcoin Competes With AI Stock Rally

Bitcoin’s latest pullback may have less to do with crypto-specific stress and more to do with Wall Street’s crowded trade in U.S. equities, according to Binance Research.

The institutional research arm of Binance said capital is being pulled into a narrow set of powerful themes in the S&P 500, leaving bitcoin on the sidelines. The firm pointed to the Cboe Dispersion Index, which has climbed to 42, its third-highest level on record.

A high dispersion reading suggests that market gains are heavily concentrated in a limited number of stocks or sectors. In the current cycle, Binance Research said investors are crowding into artificial intelligence, semiconductors, defense, energy, and commodities.

That creates a simple but important liquidity problem for bitcoin. When a few equity themes generate outsized returns, capital follows those trades. As money concentrates in stocks, less liquidity is available for crypto assets. Bitcoin then becomes a funding casualty rather than the source of the weakness.

The pattern is not new. Binance Research cited several past examples when intense equity-market rotations coincided with bitcoin declines.

In 2015, capital moved into FAANG stocks and biotech, while bitcoin fell 20%. In 2016, a defensive equity rotation matched an 18% bitcoin drop. Late-cycle FAANG strength and the ICO collapse in 2018 came alongside a 68% fall in bitcoin.

The same pattern appeared again in 2022, when energy stocks surged, and bitcoin lost 50%. Binance Research also pointed to the fourth quarter of 2025, when AI and semiconductor stocks gained more than 200%, while Bitcoin declined 39%.

The latest pressure is smaller but still meaningful. In the second quarter of 2026, Binance Research said a combined rotation into AI, defense, and energy has coincided with an 11% bitcoin decline.

The firm described the current backdrop as one of bitcoin’s strongest multi-theme capital diversions. Growth capital is moving into AI infrastructure and applications. Geopolitical hedge capital is flowing into defense and energy. Inflation-hedge demand is shifting toward commodities.

Bitcoin, in that setup, is competing for attention on several fronts at once.

Still, Binance Research said history points to a possible rebound. In past periods when the Cboe Dispersion Index reached extreme levels, Bitcoin often found a bottom within zero to 20 weeks. The median was about two weeks in cases without a crypto-native crisis.

That distinction matters. Binance Research said the current downturn does not appear to be caused by a major internal crypto shock. If the weakness is mainly due to temporary capital diversion into equities, the firm said Bitcoin may recover faster once those crowded trades cool.

Missouri Attorney General Catherine Hanaway announced that her office has filed suit against GPD Holdings LLC, doing business as CoinFlip, alleging the company knowingly facilitated fraudulent transactions through its cryptocurrency kiosks while profiting from excessive and inadequately disclosed fees.

The lawsuit, filed in Jasper Circuit Court, claims CoinFlip violated the Missouri Merchandising Practices Act by failing to prevent scam-related transactions at its Bitcoin ATMs and by concealing transaction fees that could reach nearly 22% of a transaction’s value.

“Bitcoin and crypto ATMs are the new getaway cars for fraud, whisking away innocent people’s money to scammers, never to return,” Hanaway said in a statement. “As Attorney General, I’ll use every tool to flush out the cowardly scammers hiding behind screens and hold them accountable. My office will always prioritize protecting Missourians — especially our seniors and veterans.”

CoinFlip advertises itself as the “world’s largest network of cryptocurrency ATMs by transaction volume” and operates more than 140 kiosks across Missouri in convenience stores, liquor stores, vape shops and gas stations, according to the attorney general’s office.

The petition alleges CoinFlip publicly markets its kiosks as safe and equipped with fraud-prevention mechanisms, while scam transactions involving its machines continue to occur regularly in Missouri.

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According to the lawsuit, cryptocurrency ATM scams have increased dramatically in recent years because cryptocurrency transactions are difficult to trace and irreversible.

The Federal Trade Commission reported that fraud losses involving crypto ATMs increased nearly tenfold from 2020 to 2023, with more than $65 million in reported losses during the first half of 2024 alone.

The lawsuit also cites FTC data showing reported fraud losses among seniors involving cryptocurrency scams have increased more than 20-fold since 2020.

The Missouri State Highway Patrol’s Missouri Information Analysis Center and the St. Louis Fusion Center identified more than 350 cryptocurrency-related cases involving crypto ATMs during the past two years, according to the attorney general’s office.

The state’s petition details several alleged scam incidents involving Missouri residents. One victim, identified in the filing as an 80-year-old veteran, allegedly lost between $180,000 and $200,000 after being persuaded by someone claiming to have made money through cryptocurrency investments.

The lawsuit states the victim sold his vehicle, withdrew money from legitimate investment accounts and nearly lost his apartment before ending communication with the scammer in March 2026.

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The petition alleges the victim used CoinFlip ATMs to convert cash into Bitcoin and was never clearly informed of transaction fees.

The filing states the victim was unable to recover any of the funds and now survives on Social Security.

Another victim allegedly withdrew $1,000 after receiving a call from someone posing as a Jefferson Sheriff’s Office employee claiming she had missed jury duty and faced arrest warrants.

The woman was directed to deposit money into a CoinFlip ATM at a vape shop. According to the lawsuit, a vape shop employee warned her she was being scammed, but she still lost the money and later learned only $182.38 in transaction fees could potentially be refunded.

A third victim allegedly lost $900 after a caller posing as a Boone Sheriff’s Office employee directed her to a “police monitored” CoinFlip ATM to pay supposed warrant fees.

The attorney general’s office alleges CoinFlip’s internal records and policies demonstrate the company was aware its machines were frequently used for scams. The lawsuit states CoinFlip tracked “blacklist reported criminal and terrorist wallet addresses” and maintained policies related to identifying elder financial exploitation.

The petition further alleges CoinFlip failed to act on warning signs, such as multiple users sending cryptocurrency to the same wallet addresses and older customers using kiosks while speaking on the phone with scammers.

The suit also alleges CoinFlip concealed transaction fees by prominently displaying only a $2.99 “Network Fee” while burying larger transaction fees in its terms of service.

According to the petition, customers depositing $100 into a machine could receive only about $75.76 worth of Bitcoin after fees were deducted.

The attorney general’s office launched a statewide investigation into cryptocurrency kiosk operators in December 2025 amid concerns about deceptive fee structures and scams involving crypto ATMs.

The lawsuit asks the court to declare CoinFlip’s practices unlawful under the Missouri Merchandising Practices Act, permanently enjoin the company from operating in Missouri until fraud-prevention measures are implemented, and impose civil penalties of up to $1,826,000 for alleged violations over the past five years.

The state is also seeking restitution for consumers, including the victims identified in the lawsuit.

“Our mission is simple: protect Missourians’ hard-earned money and stop scammers in their tracks,” Hanaway said. “It’s not just Bitcoin ATMs; it’s all fraud, and we will go after any business taking advantage of vulnerable Missourians.”

The attorney general’s office urged Missourians who believe they have been harmed through the use of a cryptocurrency kiosk to contact local law enforcement, report the incident to the FBI’s Internet Crime Complaint Center and file a complaint with the attorney general’s office.

Crypto Still Excluded From Legal Tender Status

South African regulators have reiterated that cryptocurrencies and stablecoins are neither money as defined in the country’s National Payments System Act nor funds, and are therefore not legal tender. In a joint statement, the South African Reserve Bank (SARB) and the Financial Sector Conduct Authority (FSCA) said they are already conducting analytical work to explore the regulatory treatment of crypto assets for payment purposes.

The joint regulatory clarification responds directly to a shifting financial landscape in South Africa, where digital assets are rapidly transitioning from speculative investments to mainstream transactional tools. This domestic migration toward decentralized finance has intensified pressure on current monetary policies. Prominent South African economist Dawie Roodt argues that the country’s existing exchange control laws are fundamentally incompatible with modern capital flows, warning that a failure to modernize these regulations will inevitably accelerate consumer abandonment of the local currency in favor of more stable, digitized alternatives.

However, the regulators counter that widespread crypto adoption could compromise the efficiency of the National Payments System (NPS) and trigger broader systemic risks across the financial sector. To mitigate these vulnerabilities, the South African government aims to expand the regulatory perimeter of the NPS Act.

“The revision of the NPS Act will include provisions that would enable the SARB, at its discretion, to declare and regulate payment instruments other than money, such as crypto assets. Among other aspects, this will provide the SARB with the authority and discretion, should a compelling case arise, to designate crypto assets as payment instruments for domestic transactions,” the statement reads.

While the SARB is not envisioned to regulate “unbacked” crypto assets as payment instruments, the approach toward stablecoins will be different. Because stablecoins have been determined to possess some characteristics of digital money, they have the potential to be adopted as a payment instrument, the regulators said. Consequently, the Intergovernmental Fintech Working Group (IFWG) is analyzing the applicable use cases of local currency-pegged stablecoins to inform an appropriate policy and regulatory response.

Still, the South African central bank is unlikely to sanction or consider foreign currency-pegged stablecoins as payment instruments for domestic transactions because they “may result in the risk of currency substitution (‘dollarization’), which would weaken the monetary policy transmission.”