Galaxy Digital CEO Mike Novogratz attributes Bitcoin's recent decline to a crisis of confidence. He points to Strategy's (formerly MicroStrategy) sale of 32 BTC between May 26 and 31.
The sale, totaling approximately $2.5 million, was the company's first since December 2022. While economically insignificant for a firm holding roughly 844,000 BTC, Novogratz says the symbolism was psychologically devastating for the market.
He highlighted roughly $14 billion in unrealized losses weighing on sentiment. When a company whose identity is tied to Bitcoin shows such paper loss, even a small sale raises alarm.
The sale occurred during a broader selloff driven by ETF outflows, a strong US dollar, and hawkish Federal Reserve signals. Bitcoin saw its largest weekly loss since late 2022, trading in the $60,000 to $72,000 range.
Novogratz's analysis forces an uncomfortable question: how much of Bitcoin's price was built on the assumption Strategy would never sell? With holdings of approximately 844,000 BTC, any hint of liquidation could trigger a self-reinforcing selling cycle.
The $59,000 to $60,000 support zone is now critical. A break below could trigger more liquidations. Conversely, Strategy's average cost basis is around $75,699, meaning the company is barely underwater. The sale could reflect routine treasury management, but Strategy must prove it was an anomaly, not a precedent.