Bitcoin Slumps After Fed Decision and Strategy's $5 Billion Sale Plans

Bitcoin's price action in the final week of July was marked by optimism and caution as investors awaited the Federal Reserve's interest rate decision. The market initially responded positively to the unchanged rates, with a brief rebound before momentum faded. This followed several sessions of uneven ETF flows, where institutional demand slowed.

The US spot Bitcoin ETFs recorded net inflows on July 30, but this was preceded by outflows, including more than $465 million leaving the funds late in the previous week. This mixed picture suggests that institutional investors remain cautious despite Bitcoin's resilience around key technical levels.

Selling pressure intensified on Friday after Strategy, the world's largest corporate holder of Bitcoin, reported weaker-than-expected quarterly earnings and revealed it could sell up to $5 billion worth of Bitcoin as part of its capital management strategy. The company's CEO Phong Le stated that this potential sale would strengthen Strategy's cash position and provide greater financial flexibility.

Bitcoin fell 3.1% over the following 24 hours to around $62,700 after touching an intraday low near $62,500, its weakest level since early July. Strategy shares also dropped 7.3% on Friday, extending their decline for the year.