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ToggleBitcoin weakened after being capped at $78,000 on Thursday, and even fell below the $75,000 mark on Wednesday. The most noteworthy aspect of this decline is the substantial shift in Bitcoin's relationship with traditional markets. Having closely followed the US stock market for the past two months, BTC chose to fall independently on the same day the Nasdaq 100 index hit a record high.
Miners selling off their shares and the dual pressures of AI transformation
One of the core reasons for the weak price of BTC is the large-scale sell-off by miners and the industry's transformation. Several publicly listed Bitcoin mining companies have recently sold off their BTC reserves and redirected the funds to AI infrastructure construction.
TeraWulf (WULF) is one of the most representative cases. This mining company announced it would add 1 gigawatt of high-performance computing (HPC) capacity in Kentucky, essentially transforming its traditional mining farm into an AI data center. This means that miners' accumulated BTC could be monetized more quickly to pay for the capital expenditures on AI hardware.
This trend was already beginning to emerge in 2025. A VanEck report indicated that if Bitcoin mining companies partially shifted their focus to AI and high-performance computing by 2027, they could earn an additional $13.9 billion annually. AI companies require energy, and Bitcoin mining companies happen to have the most abundant energy resources. This "miner exodus" directly exacerbates the supply-side pressure on BTC.
Selling off stocks linked to political figures exacerbated market panic.
According to Lookonchain data, Trump Media & Technology Group (DJT) transferred 2,650 BTC (approximately $205 million) from its cold wallet to a crypto exchage on Friday. This media group, controlled by the Trump family, had previously accumulated 11,542 BTC at an average price exceeding $11,850 each.
This large-scale cashing out by politically affiliated entities has a significant impact on market sentiment. Investors will question whether these BTC came from exchange deposits or were sold directly on the blockchain, both of which could create substantial selling pressure in the short term.
US encryption legislation stalls
Slow progress on two key cryptocurrency bills in the US Congress has further dampened market expectations for an imminent policy boost:
The Digital Asset Parity Act aims to reform the crypto tax system, exempting miners and staking rewards from being taxed before they are sold. The proposal was formally submitted in May but has not yet been scheduled for hearings or a vote.
The Digital Asset Market Clarity Act is awaiting a vote in the full Senate, with no date yet set. This bill would divide regulatory authority over digital assets between the CFTC (Commodity Futures Trading Commission) and the SEC (Securities and Exchange Commission), while complementing the already passed GENIUS Act (Stablecoin Act).
The legislative stagnation means that the US crypto market remains in a state of uncertainty regarding "regulatory certainty," making it difficult for investors to factor policy benefits into their valuation models.
Federal Reserve's balance sheet stalls, liquidity expectations fail to materialize.
The market had previously expected the Federal Reserve to continue expanding its balance sheet, injecting liquidity into the market by purchasing U.S. Treasury bonds. However, since April 15, the Fed's total assets have stagnated at $6.7 trillion, and the pace of expansion has slowed significantly.
Rising oil prices have fueled inflation expectations, prompting the Federal Reserve to become more cautious in its monetary policy. Expansionary measures that push up oil prices and inflation too quickly could actually hinder economic growth. This also means that market expectations for "liquidity premiums" are being readjusted.
Capital flows into AI infrastructure
The weakness in Bitcoin contrasts sharply with the surge in the AI infrastructure sector. Memory chip giants SK Hynix and Micron have seen their market capitalization surpass the $1 trillion mark for the first time, with several stocks rising more than 20% in a single week.
This diversion of funds indicates that investors are shifting their bets from "digital gold" to "AI hard currency." As tech giants continue to exceed earnings expectations, funds will naturally flow from the relatively static Bitcoin to the AI supply chain, which has substantial output growth.
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