Bitcoin Holds Near $65K as Mining Difficulty Drops 10%, Shorts Lose $500M

Bitcoin News

Bitcoin staged a cautious recovery over the weekend, climbing back above $63,000 after briefly slipping under $60,000 during the market’s worst week since the FTX collapse of 2022. The rebound lifted the total crypto market capitalization by 2.8% to $2.26 trillion, with many altcoins outpacing Bitcoin itself. XRP advanced 3.3% to $1.16, Solana gained 3.7% to $66.61, and Hyperliquid’s HYPE token surged 12.2% to $64.50, ranking as the strongest performer among large caps. The recovery remains fragile, however, as fresh tensions in the Middle East continue to inject sharp volatility into altcoin and major-asset pricing alike.

The Bitcoin network is set to undergo one of the largest downward mining-difficulty adjustments in its 17-year history. The automated recalibration, triggered at block height 953,568, is projected to cut difficulty by roughly 9.55% to 10.3%, dropping the metric from 138.96 trillion toward 124.25 trillion. That would mark the second-largest reduction this year, trailing only February’s 11.16% decline, and ranks among the eleven steepest negative adjustments ever recorded. The cut follows a sharp drop in network hashrate as BTC slid near $63,000, squeezing miner margins and forcing older-generation rigs offline. Analysts expect hashprice to recover above $30 per PH/s, easing pressure on operators that stay online, a dynamic tied directly to the network’s consensus mechanism.

The speed of the rebound caught heavily positioned traders flat-footed, triggering a wave of forced selling that exceeded half a billion dollars in liquidated short positions within a single session. The sudden upswing punished bearish bets that had accumulated during the prior week’s steep decline, when sentiment had turned decisively negative. Such large-scale liquidation cascades often amplify short-term price swings, as forced buy-backs add momentum to an already sharp move. The episode underscores how crowded the short side had become after Bitcoin’s slide toward the low $60,000s, leaving the derivatives market vulnerable to a rapid squeeze once buyers stepped back in and reversed the prevailing trend.

Corporate accumulation also returned to the spotlight. After a controversial round of selling the previous week that drew scrutiny from market watchers, Strategy resumed large-scale Bitcoin purchases, signaling renewed conviction from one of the asset’s most prominent corporate holders. The move stands out against a backdrop of broad caution, as many institutional players had retreated to the sidelines amid the recent drawdown. Strategy’s renewed buying reinforces the narrative that deep-pocketed treasuries continue to treat sharp price dips as accumulation opportunities rather than exit signals. The timing, arriving just as Bitcoin reclaimed the $63,000 level, added to the recovery’s momentum and helped steady sentiment across the broader market.

Macro stress spilled well beyond crypto over the same period. South Korea’s stock exchange was forced to temporarily halt trading after a sharp plunge, a circuit-breaker event that rattled regional risk appetite and reverberated across digital-asset desks. The disruption coincided with renewed geopolitical flashpoints in the Middle East, where fresh attacks kept traders on edge and fueled erratic price action. For a crypto market still nursing losses from its worst week in years, the combination of a major equity exchange seizing up and escalating conflict abroad highlighted how tightly Bitcoin remains tethered to global macro conditions, even as its own network fundamentals draw separate scrutiny.

Policy signals added another layer to the week’s narrative. In the United States, President Donald Trump intensified his push for interest-rate cuts, a stance that could prove supportive for Bitcoin if looser monetary conditions revive appetite for risk assets. Against that backdrop, prominent analyst Michaël van de Poppe drew attention by detailing why he has rotated his entire portfolio into altcoins, framing the current weakness as a setup rather than a reason to retreat. His bullish positioning runs counter to the prevailing fear gripping traders and suggests some participants view the downturn as the late stage of a bear market phase rather than the start of a deeper collapse.

COINOTAG’s proprietary 42-indicator composite scoring engine rates the $64,780 resistance at 78/100, the strongest near-term ceiling, driven by the confluence of the Fibonacci 0.236 retracement, R1 pivot and prior-day high; with spot at $64,508, that level is the immediate hurdle. Just below, the $64,172 support scores 77/100 on S2 and Fibonacci 0.214 readings. Derivatives data shows a marginally negative funding rate of -0.0003%, $11.96 billion in open interest and a long/short ratio of 1.54, indicating traders remain net-long despite a Fear & Greed reading of 18 (Extreme Fear). A reclaim of $64,780 opens the path toward $68,191; a daily close below $62,331 would invalidate the bullish case and expose the $59,130 floor.