Bitcoin (BTC) has fallen into bear-market territory after a sharp overnight selloff, while Michael Saylor framed the decline as a temporary capital rotation into artificial intelligence rather than a loss of confidence in the asset.
Summary
- Bitcoin fell into bear-market territory after dropping 22.7% from its four-week high.
- Michael Saylor said that AI infrastructure funding caused capital to rotate away from Bitcoin ETFs.
- The strategy’s small Bitcoin sale raised concern because the company had not sold BTC since 2022.
Strategy Executive Chairman Michael Saylor said Thursday on X that capital markets have directed about $400 billion into AI infrastructure over the past six months, while spot Bitcoin ETFs have recorded about $4 billion in outflows since May 14. Saylor said the withdrawals have placed pressure on bitcoin, but he described the move as “a capital rotation, not a Bitcoin impairment.”
Bitcoin dropped as low as $61,400 overnight before cutting part of the decline to trade near $62,400 in premarket hours Thursday. The asset was down 7% over 24 hours and more than 14% over the past week. Based on the recent move, Bitcoin has now fallen 22.7% from its four-week high. The decline has also erased more than $600 billion from the total crypto market value, according to the figures cited in the market report.
Saylor links Bitcoin pressure to AI spending
Saylor’s explanation framed the sell-off as part of a larger capital move toward AI infrastructure. Wall Street consensus estimates put hyperscaler capital expenditures above $600 billion for 2026, while CreditSights estimates that about $450 billion of that amount will go into AI hardware, servers, and networking equipment.
According to Saylor, the bitcoin decline does not show damage to the investment case for the asset. He said volatility creates opportunity, while ETF outflows have added pressure during a period when institutions are funding AI-related projects at historic levels.
At the same time, the timing of his comments drew attention because Strategy recently sold a small portion of its bitcoin holdings.
Strategy’s Bitcoin sale draws market attention
Strategy disclosed in a June 1 Form 8-K that it sold 32 Bitcoin between May 26 and May 31 at an average price of $77,135 per coin. The company said the sale raised $2.5 million net of expenses and would help fund dividend payments on its STRC preferred shares.
The sale was small compared with Strategy’s total holdings. The company remains the largest corporate bitcoin holder, with 843,706 BTC valued at roughly $61 billion based on the figures in the report.
However, analysts cited in the report said the transaction affected market sentiment because Strategy had not sold bitcoin since late 2022. Saylor’s public image as a steady Bitcoin accumulator had become part of the company’s market identity, and the sale gave bearish traders a new point of focus during the selloff.
Balance sheet moves came before the decline
One week before the sale, Strategy had already changed its financial focus. The company repurchased $1.5 billion of its 0% convertible notes due 2029 for about $1.38 billion in cash.
According to Strategy, the transaction cut its debt obligations by about $120 million and reduced outstanding convertible debt from $8.2 billion to $6.7 billion. The company also reported an $871 million cash reserve after the repurchase.
At that time, Strategy held 843,738 BTC and said it planned to rebuild its liquidity buffer through future capital raises.The Bitcoin decline also weighed on Strategy’s stock. MSTR has fallen nearly 15% over five trading days, according to the market figures in the report. While Saylor argued that bitcoin faces temporary pressure from AI-driven capital flows, Strategy’s decision to sell even a small amount of bitcoin has complicated the market response.
