Bitcoin extended its sharp decline Wednesday, falling to $61,300 for the first time since February. The world's largest cryptocurrency is now down more than 25% from its early June high and over 30% year-to-date, marking one of its weakest performances relative to other risk assets.
The sell-off is being driven by long-term holders-investors who've held Bitcoin for at least 155 days-who offloaded roughly $2.4 billion in early June after remaining mostly dormant from February through April. A significant portion came from those who bought above $90,000 and had resisted selling during months of price erosion.
Volatility has spiked, with Volmex's 30-day implied volatility index hitting 57.4, its highest since early April. US-listed spot Bitcoin ETFs recorded their thirteenth consecutive day of outflows, with another $50 million pulled Wednesday.
Meanwhile, regulatory uncertainty is compounding the market's woes. The Digital Asset Market Clarity Act (CLARITY Act) is struggling to pass the Senate before the summer recess. Though approved by the Senate Banking Committee, it must reconcile with a separate version from the Agriculture Committee, and only about eight weeks of floor time remain for a bill requiring potentially a full week of debate.
Treasury Secretary Scott Bessent urged passage, calling it key to making the US "the innovation capital of the world." But opposition from banking leaders, including JPMorgan CEO Jamie Dimon, who argued stablecoin issuers would gain unfair advantages, complicates the path forward.