Citi analysts noted that Strategy's recent bitcoin sale was part of a previously disclosed tax-optimization plan and does not alter the firm's broader strategy. The bank emphasized that spot bitcoin ETF flows explain roughly 45% of weekly BTC price movements and remain the best gauge of investor adoption. With ETF flows turning negative for a record 11 consecutive days and prospects for a U.S. crypto market structure bill diminishing, Citi expects sentiment to remain subdued. The report highlighted that the bigger issue is the lack of fresh investor demand, not Strategy's sale. Bitcoin has slumped 9% since Sunday and dropped to the lowest since March.

Key facts

• Strategy's bitcoin sale was a tax-optimization move, not a change in strategy.
• Spot bitcoin ETF flows account for about 45% of weekly BTC price variation.
• ETF flows have been negative for a record 11 straight days.
• Prospects for a U.S. crypto market structure bill are diminishing.
• Citi expects subdued sentiment due to lack of fresh investor demand.

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