The market’s top cryptocurrency, Bitcoin (BTC), is coming under new pressure as multiple warning signs converge – from heavy selling in the exchange-traded fund (ETF) complex to renewed doubt surrounding Strategy’s long-held “never sell” narrative.
The result was a weak session: On Wednesday, the cryptocurrency fell below the key $66,000 level, extending a sell-off that has already wiped out about $160 billion in total market value this week. according to to Bloomberg.
Bitcoin Selloff of $2.5 Million Scares the Market
Earlier this week Michael Saylor’s Strategy sold Bitcoin worth about $2.5 million from a large holding company currently valued at about $56 billion. Strategy reportedly reduced its supply by just 32 tokens out of 843,706 coins.
Still, analysts say the size of the sale matters less than the message it sends, especially at a time when Bitcoin has underperformed in recent weeks.
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Rajiv Sawhney, head of international portfolio management at Wave Digital Assets, argued that the financial impact is negligible compared to The overall position of the strategy. He described the sale as “financially trivial” and called it essentially “a rounding error” over a stake worth about $62 billion.
However, Sawhney emphasized that it is about market psychology: the idea that the company had maintained a ‘never sell’ attitude for a long time was part of the market’s expectations.
Bitcoin’s weakness is also taking shape against a very different backdrop in traditional markets. US stocks have moved higher, with technology stocks in particular making new highs.
Capital turns to AI stocks
Artificial intelligence (AI) remains the dominant theme attracting capital, and the numbers clearly show the difference. Over the past twelve months, the Nasdaq 100 is up 42%, while Bitcoin is down 37% and is currently 48% below its peak.
Carney Mak, a partner at FXHB Asset Management, said part of the rotation was moving capital from Bitcoin and digital assets into AI stocks. According to him, AI offers a more favorable risk-reward ratio than digital assets, which has prompted some investors to rebalance their portfolios.
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Macro and liquidity conditions are also becoming increasingly difficult to ignore. Mak noted that crypto currently lacks a strong short-term catalyst, and market performance has become increasingly reach-dependent. In that environment, he says, results are more dependent on overall liquidity and broader economic factors.
The Bitcoin ETF market adds another layer of pressure. Data from Bloomberg shows that investors have withdrawn nearly $4 billion from U.S. exchange-traded Bitcoin funds over the past 12 sessions, marking a record streak of consecutive outflows.
At the time of writing, Bitcoin was trading around $65,721, after losing nearly 2% on Wednesday, adding to the 12% retracement recorded over the past seven days, according to CoinGecko. facts.
Featured image created with OpenArt; chart from TradingView.com