Bitcoin slides as weak U.S. demand signals weigh on crypto market sentiment

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Bitcoin slides on weak U.S. demand

Highlights

Bitcoin drops over 1.5% to below $63,000 amid a broader risk-off move, dragged down by semiconductor and crypto-exposed equities like MSTR (-3.5%) and STRC (-2.7%).
Coinbase Bitcoin Premium Index remains negative for 60 consecutive days, indicating sustained weak U.S. institutional demand and reducing the support that fueled earlier price gains.
U.S. spot bitcoin ETFs see $79.15 million net inflows on July 16, led by BlackRock's IBIT ($33.44 million), while spot ether ETFs record $28.04 million in net outflows.

Market pressure and institutional demand signals

As reported by The Block, bitcoin falls below $63,000 on Friday as a sell-off in semiconductor stocks pulls crypto into a wider risk-off move across markets. Simon-Peter Massabni, head of business development at XS.com, says bitcoin drops more than 1.5% and fails to hold above that level, while the Nasdaq 100 closes about 1.6% lower in the prior session.

The weakness also reaches Strategy-linked securities. Massabni says MSTR falls 3.5% and STRC declines 2.7%, reflecting how equity pressure is feeding into crypto-linked names as investors trim exposure to risk assets.

Data cited from Coinglass show the Coinbase Bitcoin Premium Index stays negative for 60 straight days, a record stretch that points to soft U.S. institutional demand. The trend suggests buyers in the U.S. market are not providing the support that helped drive earlier price gains this year.

Strategy exposure and broader market implications

Strategy’s preferred stock is drawing added scrutiny, with STRC, the company’s largest preferred series by capital raised, closing at $85.4 against a $100 par value. Massabni interprets that discount as a sign of investor caution toward the company’s funding model as it continues raising capital through common stock issuance and other preferred series.

He says the company holds roughly 4% of bitcoin’s maximum supply, making the strength of its balance sheet important for the cryptocurrency. JPMorgan describes Strategy’s decision to boost cash reserves as an encouraging sign for bitcoin, while Chief Executive Phong Le says the company remains committed to buying bitcoin and sees debt concerns emerging only if the price drops below $10,000.

Massabni also says the lack of a comprehensive deal on managing the Strait of Hormuz keeps energy inflation risks elevated, raising the prospect of higher-for-longer Federal Reserve policy rates. He cites the CME FedWatch Tool as showing a 30% chance of a 50-basis-point Federal Reserve rate hike before year-end.

On fund flows, SoSoValue data show U.S. spot bitcoin ETFs record net inflows of $79.15 million on July 16, led by BlackRock’s IBIT with $33.44 million. Spot ether ETFs post net outflows of $28.04 million, although Bitwise’s ETHW records the largest single-day inflow at $2.28 million.

Pires says bitcoin’s core fundamentals remain intact, but capital allocation decisions are shifting for large investors in a high-inflation environment. She describes the current trading range as a potentially attractive entry point for longer-term investors and identifies meaningful support around $55,000, while arguing the latest weakness reflects positioning and liquidity more than a deterioration in fundamentals.

In our earlier article on the Nasdaq 100’s slide amid a rotation out of AI and semiconductor leaders, we highlighted how broad selling in chip stocks pushed the index below key short- and medium-term moving averages. Traders Union experts noted that technical and sentiment pressure could keep volatility elevated, with support levels at risk if weakness in the chip sector persists.

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