On Monday, Bitcoin once again demonstrated its volatility, experiencing two sharp price surges despite easing tensions in the Middle East. After the cryptocurrency struggled to hold above the $64,600 level on Sunday evening, it jumped to a session high of $65,500 as markets reacted to reports of a halt in fighting between U.S. and Iranian forces.
Despite a pullback to just above $65,000 soon after, Bitcoin held its ground for most of early Sunday morning. By 2:15 a.m. Eastern Time (EDT), it had climbed back to the $65,500 mark, but a subsequent wave of selling nearly six hours later pushed it back below $65,000. A third attempt to breach the $65,500 level was unsuccessful, triggering a sharper decline to $64,336.
Although the cryptocurrency partially recouped its losses, the overall price momentum remained stable, and market capitalization held steady at around $1.3 trillion. However, with only a few days left until the end of July, Bitcoin's slight price gain has brought it close to finishing the month in positive territory after it began trading below the $59,000 mark.
The sharp price swings in Bitcoin inflicted damage on both over-leveraged traders who had opened short positions and those who had opened long positions. According to Coinglass data, nearly $45 million worth of short positions were liquidated in a 24-hour period, while approximately $30 million in leveraged long positions were wiped out during the same timeframe.
Although market sentiment last week was dominated by the escalating U.S.-Iran conflict and legislative initiatives regarding the CLARITY Act, the sudden easing of geopolitical tensions triggered a sharp drop in crude oil prices, providing an immediate boost to risk assets, including cryptocurrencies. However, this upward momentum quickly stalled. Weak inflows into spot Bitcoin ETFs combined with ongoing political disagreements over the final text of the CLARITY Act have renewed regulatory pressure and limited gains.
Public organizations such as the Crypto Council for Innovation (CCI) are refuting criticism that the bill does not adequately address national security concerns, emphasizing that the bill represents the most comprehensive digital asset enforcement measure to date by expanding anti-money laundering and counter-terrorist financing (AML/CFT) rules. CCI also argues that the legislation establishes cybersecurity standards for decentralized finance (DeFi) in collaboration with NIST and allocates $150 million to FinCEN for its implementation.
Another factor curbing the upside was Strategy's decision not to increase its Bitcoin holdings, despite raising $544.5 million from a new MSTR stock sale. This major institutional player's decision to remain on the sidelines deprived the market of a key growth catalyst, resulting in Bitcoin's inability to consolidate above the crucial $65,500 resistance level.
