Bitcoin Slides to Two-Month Low Near $65.6K as Bessent Backs Strategic Reserve, ATM Bans Spread

Bitcoin News

The recent weakness in Bitcoin has less to do with Strategy's selling activity and more to do with a broader rotation out of speculative assets, according to a Charles Schwab analyst. The view frames BTC as a momentum trade that has lost its edge to artificial intelligence equities, IPO launches and precious metals since October. Despite spot ETF approvals, billions in institutional inflows and incremental regulatory clarity, BTC has failed to extend into a parabolic phase. The argument: capital chases performance, and right now performance lives in AI infrastructure stocks and gold, not digital assets, leaving Bitcoin stuck in what some now describe as a structural bear market phase.

Bitcoin tumbled to a more than two-month low on Wednesday, hitting roughly $65,590 intraday as renewed Middle East tensions rattled risk assets. Brent crude jumped to a 12-day peak of $96 per barrel after U.S. Central Command intercepted Iranian missiles and conducted defensive strikes near the Strait of Hormuz, the chokepoint for one-fifth of global oil flows. The 10-year Treasury yield climbed to 4.5% as traders priced in stickier near-term inflation. Ethereum and Solana shed roughly 5% each, sinking to $1,830 and $72, while the Nasdaq slid nearly 1% from its all-time high and the Dow shed over 430 points.

A quieter but consequential front is opening at the state level, where lawmakers have moved to outlaw or strangle Bitcoin ATM operations under the banner of consumer protection. Outright bans are now law in Indiana, Tennessee and Minnesota, while California, South Dakota, Wisconsin and Virginia have layered on caps that make profitable operation effectively impossible. The cash-to-BTC channel processes roughly $3.63 billion in U.S. flows annually and remains one of the few unbanked on-ramps to self-custody. Industry data places ATM fraud rates at 1.2% — well below the 3% to 5% baseline across traditional financial services — undercutting the official rationale for the crackdown.

Treasury Secretary Scott Bessent told the Senate Finance Committee on Wednesday that the Trump administration is advancing the Strategic Bitcoin Reserve with "all deliberate speed" and urged lawmakers to clear both the BITCOIN Act and the Clarity Act before the summer recess. Speaking at a hearing on the fiscal year 2027 Treasury budget, Bessent tied the reserve to a national-security framework, arguing that economic strength underwrites geopolitical leverage. The reserve, established by executive order in March 2025, currently holds an estimated 328,372 BTC worth roughly $25 billion, all sourced from criminal forfeitures rather than open-market purchases that would draw on taxpayer funds.

The fading momentum argument carries weight when measured against capital flows in adjacent asset classes. Gold has absorbed sustained inflows as investors hedge against both equity drawdowns and crypto volatility, while public companies tied to AI data centers, advanced compute and energy infrastructure continue delivering outsized returns. That competitive dynamic represents a structural shift from prior cycles when retail flows defaulted to crypto for high-beta exposure. With BTC having peaked in October and failing to reclaim its all-time high despite a successful spot ETF launch from another major Wall Street issuer, the case for a near-term speculative resurgence depends on AI enthusiasm cooling.

Wednesday's session illustrated how quickly correlation can punish digital assets when macro stress flares. The same geopolitical shock that lifted oil and yields simultaneously sapped enthusiasm from tech equities, with traders on prediction markets penciling in a 57% probability that crude touches $120 before retracing to $55. That binary pricing reflects deep uncertainty about whether negotiations to stabilize the Strait of Hormuz can hold. Analysts at one major crypto trading firm noted that Strategy's recent BTC disposals compounded the negative sentiment, even as the deeper driver remained external — rates and energy — rather than crypto-native supply pressure or any rupture in the blockchain demand thesis.

Technically, BTC sits at $65,387 with a 24-hour decline of 3.05% and an RSI of 21 — deeply oversold territory that historically precedes mean-reversion bounces, though oversold readings can persist in established downtrends. The MACD prints a bearish signal and price trades below all near-term resistance at $66,811, $69,327 and $72,733. Immediate support sits at $64,829, with deeper structural levels at $62,909 and $56,977. A reclaim of $66,811 on rising volume would neutralize the bearish setup; a decisive break of $64,829 opens the door to $62,900. The thesis invalidates on a daily close above $69,327.