An inverse leveraged exchange-traded fund tracking MicroStrategy saw a significant intraday surge of nearly 40%. At the time of writing, the fund was up 29.5%, trading at HK$79.54 with a turnover of HK$13.45 million.

The move comes amid a sustained downturn in the cryptocurrency market, with Bitcoin repeatedly testing the crucial $60,000 support level. According to reports, Bitcoin's recent decline has been driven by two primary headwinds. First, nearly $10 billion worth of Bitcoin options are set to expire on June 26th. Second, rising expectations for further Federal Reserve interest rate hikes have strengthened the US dollar, putting pressure on risk assets like Bitcoin as liquidity tightens.

Key Market Drivers

Furthermore, industry observers note that the recent sluggish performance in the crypto market is compounded by growing investor concern over the financing situation at Michael Saylor's MicroStrategy. With Bitcoin's price lingering below $60,000, the company is facing billions in paper losses on its substantial Bitcoin holdings. Its financing costs are also climbing, and the price of its preferred stock, STRC, has fallen sharply. These factors are leading more investors to question the sustainability of the company's financing strategy.