Bitcoin fell to its lowest level in nearly four months, weighed down by a deterioration in overall market sentiment due to escalating conflict in the Middle East, before recovering from those lows.
In early Asian trading on Thursday, the world's largest cryptocurrency dropped as much as 5.5% to $61,322, marking its weakest point since February 6th. The price later rebounded above $64,000 in the afternoon session, trading at $64,361 at the time of writing.
"The sharp volatility suggests Bitcoin is finding support around the $63,000 level, a key threshold closely watched by many traders," said Damien Loh, Chief Investment Officer at Ericsenz Capital. "There were significant bets placed on further price declines, but as the market began to rise, those positions were quickly unwound."
The week has been punishing for Bitcoin, with the digital asset down approximately 13% in total. The sell-off was initially triggered when MicroStrategy Inc (NASDAQ: MSTR), led by Michael Saylor, sold a portion of its massive holdings worth around $250 million. The company, which has been one of Bitcoin's largest institutional buyers in recent years, offloaded a relatively small amount, but the move still unsettled the market.
"Bitcoin prices declined this week because MicroStrategy broke its 'never sell' pledge, shaking market confidence," noted Josh Du, Chief Investment Officer at Animoca Brands.
The recent selling pressure highlights a divergence between Bitcoin and technology stocks, with the latter continuing to hit new highs even as the cryptocurrency retreated. Since reaching an all-time high above $126,000 last October, Bitcoin has lost roughly half of its market value.
Bitcoin remains vulnerable to macroeconomic risks. Prices fell further after overnight airstrikes threatened negotiations for a temporary peace agreement between the US and Iran. In Thursday's Asian session, regional stock markets and US equity futures were also trading lower.
Smaller-cap cryptocurrencies faced similar pressure. The second-largest digital asset, Ethereum, dropped to its lowest level since April 2025 before rebounding in tandem with Bitcoin in the afternoon.
Data from CoinGlass shows that approximately $1.3 billion worth of bullish bets were liquidated over the past 24 hours, with Bitcoin positions accounting for the largest portion.
Market-compiled data indicates that investors have now withdrawn a net total of nearly $4.4 billion from US-listed Bitcoin exchange-traded funds over 13 consecutive trading days, setting a record for the longest streak of outflows on record.