Bitcoin Plummets 2% Amid Institutional Selling Pressure

The price of Bitcoin (BTC) fell by about 2% to $63,039 on July 31, underperforming the broader market due to renewed institutional selling pressure from spot Bitcoin ETFs and corporate treasuries.

This drop is largely attributed to two major factors: direct selling from ETF redemptions and corporate treasury plans. BlackRock's iShares Bitcoin Trust (IBIT) saw clients redeem 1,948 BTC worth around $123 million on July 31, forcing the ETF to sell the underlying Bitcoin.

Additionally, Strategy (formerly MicroStrategy) announced plans to sell up to $5 billion of its Bitcoin holdings to fund dividends and share buybacks, creating direct measurable selling pressure. The two largest institutional Bitcoin holders are simultaneously providing supply, overwhelming marginal demand.

The sell-off occurred amid a risk-averse macro backdrop for crypto, with momentum for the key U.S. crypto market-structure bill (the CLARITY Act) fading as Senate passage before the August recess grew unlikely. Furthermore, disappointing Q2 earnings from major crypto firms like Coinbase added to negative sector sentiment.

Technically, Bitcoin is testing the $62,400 level that marked a two-week low on July 31. The 7-day RSI at 36.8 suggests the market is nearing oversold territory, which could support a short-term bounce. However, the price remains below key moving averages, confirming a bearish near-term structure.