On Friday, Bitcoin fell below the $63,000 mark for the second consecutive day, with the decline accelerating at the start of the trading session.
Initially, it seemed the cryptocurrency was consolidating around $63,400 several hours after dropping to $62,912 on Thursday. However, a sell-off that began shortly after midnight pulled the price down to $62,670, after which it recovered and traded just below $62,800.
Soon after 8:00 AM Eastern Standard Time (EST), Bitcoin began to decline again, reaching a daily low of $62,470. A subsequent recovery rally helped it reclaim the $63,000 level. As of 1:20 PM EST, the cryptocurrency was trading just above $63,000, virtually unchanged over the previous 24 hours.
The stable price dynamics kept Bitcoin's market capitalization below $1.27 trillion, with weekly losses amounting to 2.6%. After a strong start to the month, Bitcoin is now nearly flat in price as August reaches its midpoint.
In the derivatives market, volatility triggered significant liquidations of over-leveraged long positions. According to Coinglass, out of the $32 million in leveraged Bitcoin positions liquidated over 24 hours, long positions accounted for $26 million—approximately $8 million less than on Thursday. Across the broader crypto market, long position liquidations totaled $94 million, while short position liquidations amounted to $72.5 million.
Bitcoin's lackluster performance was further impacted by spot Exchange-Traded Fund (ETF) data indicating an outflow of over $131 million. Thursday marked the second consecutive day—and the third this week—that ETFs experienced net redemptions. The sustained outflow suggests institutional investors may be retreating, contradicting signs of renewed interest observed last week.
An additional factor worsening market sentiment was news that index provider MSCI proposed new selection criteria for 'non-operational companies' within its global investable market indexes. Although this system is not directly targeting cryptocurrencies, it assesses whether a company's primary operational assets constitute more than 50% of its total assets.
Strategy's Response to MSCI's Proposal
Market observers note that companies actively utilizing digital assets as treasury reserves, including Strategy and Metaplanet, do not meet the proposed criteria and could be excluded from the indexes in upcoming rebalancings. While previous inclusion in major stock indexes allowed passive index funds and ETFs to automatically acquire shares of these companies, their exclusion could trigger forced selling by institutional investors.
In response, Strategy published a statement on X, strongly opposing the proposal:
"Digital assets are assets. Index providers should measure markets, not dictate what assets companies are allowed to own. MSCI's proposal puts the company at odds with the stance of regulators, markets, and its own clients. Bitcoin doesn't need MSCI. Neither does Strategy," the company stated.
MSCI's public consultation will last until September 30, with a final decision planned for October 16. If approved, the index exclusions will begin as early as November—a timeline that could trigger prolonged institutional selling and undermine an important bridge for Bitcoin adoption in the corporate sector, effectively dimming Bitcoin's year-end growth prospects.
