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Key Takeaways
- Bitcoin bounced roughly $5,000 off its 21-month low near $58,000 but has failed to break out decisively.
- The collapse of the US-Iran ceasefire and a divided Fed, with four dissenting votes on rate policy, are stoking macro uncertainty.
- Strategy sold 3,588 BTC for about $216 million, its largest sale on record, while spot Bitcoin ETFs posted eight straight weeks of net outflows.
Bitcoin has recovered roughly $5,000 since touching a 21-month low under $58,000 on July 1, but every rally attempt since has stalled well short of a decisive breakout. Five overlapping pressures are weighing on the market.
A Fractured Ceasefire Reignites Geopolitical Risk
The clearest catalyst returned this week when the ceasefire between the United States and Iran broke down and both sides resumed strikes in the Middle East. President Donald Trump said during a NATO meeting that he considers the memorandum of understanding between the two countries effectively over, a comment that came hours after the renewed fighting began.
A fresh round of strikes followed the next morning. Trump later said Iran wanted a deal and had reestablished contact, a claim he has made in past cycles of this conflict without a resolution following. Oil prices have moved sharply higher on the renewed hostilities, a dynamic that feeds directly into the second pressure point below.
A Federal Reserve Leaning Toward Higher Rates, Not Lower
Minutes from the Federal Reserve’s June meeting, released July 8, showed a committee more divided than usual, with four dissenting votes, the most since 1992. Several officials argued for keeping the door open to a rate increase rather than signaling an eventual cut, citing inflation pressure tied to the reignited Iran conflict, tariffs and resilient demand.
Futures markets are now pricing meaningful odds of a hike by the Fed’s September meeting, a reversal from earlier expectations of continued cuts. Since September 2024, the Fed had lowered its benchmark rate by 1.75 percentage points; minutes from the June meeting show no cut is currently expected before 2027. Higher-for-longer, or even higher, rate expectations typically weigh on risk assets, including Bitcoin.
Strategy Sells Record Amount of Bitcoin in Early July
Strategy, the company led by Michael Saylor that has built its identity around accumulating Bitcoin since 2020, sold 3,588 BTC for approximately $216 million between June 29 and July 5, according to a Securities and Exchange Commission filing. It is the company’s largest single Bitcoin sale on record and only its third disposal since it began buying in 2020, following a smaller 32-BTC sale in late May.
Strategy said the proceeds went toward dividend payments on its preferred stock offerings and to replenish its cash reserve, which stood at $2.55 billion as of July 5. The company continues to hold 843,775 BTC and has not tapped a separate $1.25 billion Bitcoin monetization program it announced June 29. Saylor said the sale reflects the company’s obligations to its credit investors rather than a change in his long-term view of Bitcoin, though the move differs from the “never sell” stance the company had maintained for years.
Spot Bitcoin ETFs Post Their Worst Stretch Since Launch
U.S. spot Bitcoin ETFs recorded eight consecutive weeks of net outflows through early July, with total withdrawals over that stretch surpassing $8 billion, according to data compiled by SoSoValue. June alone produced roughly $4.5 billion in net outflows, the worst monthly reading since the funds launched in January 2024.
A 10-day, $2.7 billion outflow streak ended July 2 with a single-day inflow of $221.7 million, and the funds have posted positive flows on most trading days since. Analysts have generally characterized the reversal as cautious re-entry rather than a confirmed trend change, with the next major test arriving alongside June inflation data due July 14 and the Fed’s July 28 to 29 meeting.
Coinbase Premium Stays Negative for 50 Consecutive Days
The Coinbase Bitcoin Premium Index, which tracks the price gap between Bitcoin on Coinbase and on Binance, has remained negative for 50 consecutive days since May 19, according to data from Coinglass cited by Wu Blockchain. That is the longest negative streak since the index began tracking, surpassing a prior 40-day run between January 16 and February 24.
A negative reading indicates Bitcoin is trading cheaper on Coinbase, a venue that concentrates much of the regulated U.S. institutional flow, than on Binance, which serves a larger international and retail base. Analysts view sustained negative premiums as a sign of soft U.S.-based demand. The prior 40-day streak preceded a rally that carried Bitcoin from roughly $64,000 into the mid-$70,000s over the following month, though the two periods differ in broader macro conditions and it remains unclear whether a similar pattern will repeat.
