Strategy opened the week with a boom, as an 8-K filing revealed that the largest corporate Bitcoin holder sold 32 BTC between May 26 and May 31, marking its first Bitcoin sale since December 2022. BTC abruptly sliced through underlying support, falling under $67,000, but is the market reaction overblown?
Saylor telegraphed his intent nearly 2 months prior to the sale, saying,
“We’ll probably sell some bitcoin to fund a dividend just to inoculate the market, just to send the message that we did it.”
Rather than a one-off catalyst, Bitcoin’s reaction to Strategy’s sell-new might be the culmination of multiple factors piling up and finally breaking the risk tolerance threshold, i.e., the proverbial camel’s back.
Although newly confirmed Federal Reserve Chair Kevin Warsh was projected to be a rate cut happy guy, financing the US-Israel War in Iran, the energy price shock resulting from the closure of the Strait of Hormuz, and the longer-term projected impact of President Trump’s One Big Beautiful Bill Act have analysts’ expectations for rate cuts in 2026 down, while rate hike odds in 2027 have risen above 50%.
Fortunately, in the case of bitcoin, sharp downside moves tend to have a silver lining, in this case, a discount. According to Wintermute, a major algorithmic trading firm and liquidity provider within crypto markets,
“The longer-term picture is more constructive than price suggests. While there’s still some debate over whether we’re in a bear market or not, to us it looks like the cycle is resetting. The setup looks relatively weak into the summer months, but we’re seeing longer-term holders start to TWAP into the market through the OTC desk, with no appetite to call the exact bottom but a view that these levels look attractive on an 18-month basis.”
Retail and institutional spot market orderbook data also appear to concur with Wintermute’s observation. Hyblock’s bid-ask ratio metric (set to 10% of aggregate order book depth) shows an accelerating bid for bitcoin, reinforcing the view that traders see sub-$60,000 BTC as discounted.
BTC/USDT bid-ask ratio (10% depth) turns positive. Source: Hyblock
The indicator ranges from -1 to +1, with values above zero pointing to an increasing imbalance in the orderbook structure.
Beyond the bearish technicals, bitcoin lacks a fresh set of newsflow and narrative catalysts that would lift investor sentiment. While value investors, sovereigns, and institutions may lean into the current undervaluation, investor mindshare disruption, capital flows focused on AI stocks, and the SpaceX and OpenAI IPOs are likely to continue making bitcoin the laggard.