Crypto Still Facing Doomsday Scenario Despite A Big Senate Win

Despite the big crypto CLARITY Act advancing in the Senate Banking Committee last week, a big overhang has sent Bitcoin and crypto spiraling.

Strategy’s latest $2 billion Bitcoin buy has pushed its stash to more than $64 billion. But for the first time, markets are beginning to seriously grapple with a possibility that once felt impossible: Michael Saylor may eventually have to sell Bitcoin.

Both narratives were cranking last week as Bitcoin pumped north of $81,500 — but both are looking to sour as even pro-crypto senators signal that President Trump’s growing crypto empire could still derail the bill before it ever reaches the Senate floor.

Here’s what’s swinging markets this week as the entire tech world awaits another big earnings report from Nvidia.

Bitcoin Faces a New Saylor Reality

Like clockwork, Bitcoin rallied last week into Strategy’s big ex-dividend date for its stock that is heavily advertising an 11.5% dividend. The money raised, about $2 billion, was used to once again fuel an equally sized Bitcoin buy, which was announced today.

But last week, Strategy uncharacteristically also announced something else. The company announced it would be buying back convertible notes to retire debt that would have been triggered into MSTR shares. Strategy agreed to repurchase approximately $1.5 billion of its outstanding 0% convertible senior notes due 2029 for an estimated $1.38 billion in cash. The move advances Strategy’s stated goal of growing its “bitcoin per share” but it now also shines a spotlight on debt the company may continue to prioritize.

As Fundstrat highlighted in a note last week, there remains about $3.5 billion in debt also tied to converts on a similar timeframe. That means potentially $3.5 billion not going to new buys. And considering Strategy’s buys are a main driver of price recently, it shouldn’t be surprising to see such a swift swing in sentiment.

Attention is also increasingly shifting toward Strategy’s dividend obligations tied to STRC and whether the company may eventually need to raise additional liquidity in ways investors haven’t had to consider before. (They now hold just enough cash for a little over 15 months of dividend payments vs. the stated goal of a two-year buffer.)

If capital markets tighten or investor demand weakens, Strategy may eventually face difficult choices between new equity issuance, debt management, or potentially selling portions of its Bitcoin holdings to maintain flexibility.

That shift in narrative comes as crypto investment products also just recorded their first negative week in seven weeks, with roughly $1.07 billion in net outflows, according to CoinShares.

Hyperliquid Becomes Crypto’s Hottest Trade

While Bitcoin struggles, Hyperliquid continues to separate itself from the rest of the market.

The token remains one of the few major crypto assets still deeply in the green as enthusiasm around perpetual futures trading and tokenized pre-IPO markets accelerates. The latest catalyst: tokenized SpaceX trading.

Even before a formal IPO roadshow has fully begun, traders are already speculating on SpaceX shares through tokenized markets trading on Hyperliquid via TradeXYZ wrappers. That’s helping fuel a broader narrative around Hyperliquid becoming more than just a crypto-native venue. Increasingly, it’s becoming a speculative bridge between crypto and traditional finance.

But not everyone thinks that’s a good thing.

At the Bermuda Digital Asset Forum, Plume General Counsel and former Senior Special Counsel at the SEC, Salman Banaei, warned that many of these wrapped pre-IPO products may not actually provide meaningful legal claims on the underlying securities themselves. Anthropic also recently warned investors not to buy certain shares tied to the company via special purpose vehicles that would be void.

“A lot of these products have a very loose, if any, claim to the underlying securities,” he told the Rollup.

The result is a growing divide inside crypto between firms racing to tokenize everything — and others warning that markets may be moving faster than the legal infrastructure underneath them.

For now, however, Hyperliquid continues to offer pre-IPO speculation for SpaceX. Over the last 24 hours, Hyperliquid recorded about $50 million in volumes for the pre-IPO SPCX market — a far cry from the $2 billion volumes for Bitcoin. HYPE is up 68% since last year.

The CLARITY Act’s Big Win (And New Threat)

The crypto industry celebrated after the CLARITY Act advanced out of the Senate Banking Committee on Thursday by a vote of 15-9. But the hardest part may still lie ahead.

Right now, Polymarket traders give the legislation roughly a 64% chance of passing this year. And as Senator Ruben Gallego made clear during the hearing, unresolved ethics concerns tied to elected officials profiting from crypto could still sink the bill.

“We need real enforceable standards for what is and is not acceptable for someone who holds the public trust and shouldn’t be able to profit off an industry that they enforce or regulate,” Gallego said. “If this is not resolved by the time [it reaches] the floor … I am not afraid to vote no.”

That warning matters because Gallego is one of the Democrats actively working with crypto-friendly lawmakers on the legislation.

That creates an uncomfortable tension for the industry: the administration may be the most crypto-friendly Washington has ever seen — while simultaneously becoming one of the biggest political liabilities to getting legislation passed.

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