After months of defending the $60,000 level, Bitcoin has finally broken lower. A hotter-than-expected US inflation report triggered a broad sell-off across risk assets, wiping out more than $600 million in leveraged crypto positions within an hour.
At the same time, options traders are increasingly betting that the correction isn’t over yet, while political uncertainty surrounding Donald Trump’s crypto empire is beginning to threaten one of the most important pieces of crypto legislation in US history.
Here’s what happened, and why it matters.
Bitcoin crashes below $60,000 as inflation shock triggers $600 million crypto wipeout
Bitcoin plunged below the psychologically important $60,000 level on Thursday after stronger-than-expected US inflation data rattled both traditional and crypto markets. The world’s largest cryptocurrency briefly fell to around $58,000, its lowest price since September 2024, as traders reacted to a hotter-than-expected Personal Consumption Expenditures (PCE) inflation reading of 4.1%.
The inflation surprise sparked a sharp sell-off across risk assets. The Nasdaq 100 lost roughly 2% within the first 30 minutes of trading, while Bitcoin experienced an even steeper decline. The sudden move triggered more than $600 million in crypto liquidations in just one hour, wiping out leveraged traders caught on the wrong side of the market.
Despite the sell-off, several analysts argue the move may represent more than simple panic. Some traders believe Bitcoin is entering a “manipulation phase,” with large market participants deliberately pushing prices below the key $60,000 level to trigger stop losses and liquidations before a potential recovery. Others expect one final leg lower, with $55,000 increasingly mentioned as the next major downside target.
Technical analysts now warn that the former support around $60,000 has weakened considerably, while resistance is beginning to build near $65,000. Whether Bitcoin can stabilize in July will largely depend on incoming economic data and whether inflation continues to pressure expectations for interest rate cuts by the US Federal Reserve.
Options traders brace for deeper Bitcoin decline as bearish bets surge
Bitcoin’s slide below the crucial $60,000 level is fueling a wave of bearish positioning in the options market, with traders increasingly betting that the world’s largest cryptocurrency has further room to fall. Bitcoin futures briefly dropped below $59,000 on Thursday, marking their lowest level since October 2024 and extending the asset’s decline to roughly 52% from last year’s all-time high.
One of the clearest signs of growing caution comes from the options market surrounding the iShares Bitcoin Trust (IBIT). Trading volume in IBIT options nearly doubled compared to the monthly average, while put options — contracts that profit when prices fall — outnumbered call options by more than two to one. Nearly 80% of all option premiums traded on Thursday were tied to puts, highlighting expectations that downside risks remain elevated.
Current options pricing suggests investors see a meaningful chance of additional weakness in the coming weeks. Based on contracts expiring at the end of July, markets imply roughly a 48% probability that IBIT could decline another 10%, while traders are simultaneously paying up for protection against further volatility. Similar defensive positioning is also visible in Strategy (formerly MicroStrategy), where put option activity has surged alongside concerns over the company’s close ties to Bitcoin.
Market participants say Bitcoin continues to struggle for investor attention as AI-related stocks dominate Wall Street. According to Alexander Blume, CEO of institutional asset manager Two Prime, the ongoing volatility surrounding Strategy has also weighed on sentiment, reminding investors of previous crypto market collapses. While some traders still see room for a rebound, the options market is increasingly preparing for the possibility that Bitcoin’s correction is not over yet.
Trump’s crypto empire threatens landmark US crypto legislation
President Donald Trump’s growing involvement in the cryptocurrency industry is creating unexpected political resistance to one of the most important crypto bills in US history. While Trump has positioned himself as one of the industry’s strongest supporters, critics argue that his family’s expanding crypto business interests are making it harder for Congress to pass the long-awaited Clarity Act.
The Clarity Act would establish the first comprehensive federal framework for regulating digital assets in the United States, providing clearer rules for companies and investors while dividing oversight between the SEC and the CFTC. However, the bill has become entangled in a growing debate over ethics, with several Democratic lawmakers insisting that elected officials (including the president and vice president) should be prohibited from profiting from cryptocurrency ventures while in office.
The controversy stems from Trump’s rapidly expanding crypto portfolio, which includes the $TRUMP memecoin and support for projects such as World Liberty Financial. According to estimates cited in the report, Trump and his family have earned at least $1.4 billion from crypto-related ventures since returning to the White House. While many industry leaders remain supportive of Trump’s pro-crypto agenda, some privately acknowledge that his financial interests are complicating efforts to secure bipartisan backing for the legislation.
With the Clarity Act now awaiting a full Senate vote, its fate could depend on whether lawmakers reach a compromise on ethics provisions. Supporters argue the legislation is essential to cement America’s position as a global crypto leader, while opponents warn that passing the bill without conflict-of-interest safeguards could undermine public trust. As negotiations continue, Trump’s role has become both one of crypto’s greatest political advantages — and potentially its biggest obstacle.