Market sentiment for Bitcoin has deteriorated sharply, triggering a wave of forced liquidations exceeding $1 billion in the cryptocurrency space. This represents the most severe pressure the market has faced in recent months.
On Tuesday, Bitcoin's price fell by as much as 6%, breaking below the $67,000 level for the first time since April 5th. Ongoing geopolitical risks from the situation in Iran, combined with selling activity from a major holder, have collectively suppressed investor risk appetite. According to data from CoinGlass, the scale of this forced liquidation event is the largest seen since February of this year.
Simultaneously, two traditional sources of demand that have historically provided significant support for Bitcoin's price—spot ETFs and the major holder—are now both turning into headwinds, further intensifying the market pressure.
The Catalyst: A Strategic Shift in Selling
The major holder disclosed on Monday that it sold approximately 32 Bitcoin, realizing about $2.5 million. This marks the company's first reduction in its holdings since late 2022. While the sale is minuscule compared to its total Bitcoin position of roughly $59 billion, it broke the company's long-standing, minimalist "buy-only" strategy at a sensitive moment for the market.
Jasper De Maere, an OTC trader at market maker Wintermute, commented that the selling wave appeared to be triggered by the disclosure of the 32 Bitcoin sale. However, the reality is that market momentum was already waning, and institutional participation on OTC desks was retreating to low levels, even without that specific news.
Persistent ETF Outflows Compound Price Fragility
According to data compiled by Bloomberg, U.S. spot Bitcoin ETFs have recorded net outflows for 11 consecutive trading days, setting a new record for the longest streak of withdrawals. During this period, investors have redeemed approximately $3.5 billion.
James Butterfill, Head of Research at CoinShares, noted that the price buffer effect provided by the progress of U.S. crypto regulatory legislation has been "completely offset" by the risk-off sentiment stemming from the Iran situation.
Bitcoin is now down nearly 50% from its all-time high of around $126,000, which was set in October of last year. Meanwhile, Wall Street equities continue to climb higher, buoyed by a resurgence in AI-related trading and expectations for a ceasefire agreement, creating a stark divergence from the cryptocurrency market.