ETF flows, not Strategy's sale, remain key bitcoin driver: Citi
Citi says Strategy’s recent bitcoin sale does not change its long-term “buy and hold” approach, since the move was expected after management flagged tax-driven portfolio optimization. The bigger issue for bitcoin sentiment is weakening demand: Citi sees spot ETF flows as the main driver of BTC prices, estimating they explain about 45% of weekly price variation, and notes those flows have recently turned negative. The bank also says the odds of a U.S. crypto market structure bill passing this year are fading, reducing a potential catalyst for renewed investor interest. Citi does not view digital asset treasury selling as the main cause of bitcoin’s weakness. The combination of negative ETF flows, weaker legislative prospects, and BTC’s underperformance versus equities is likely to keep sentiment subdued.
