The recent Bitcoin crash has sparked a heated debate, with Michael Saylor, the chairman of Bitcoin-focused firm Strategy, blaming the AI boom for the selloff. However, Arca, a crypto investment firm, has a different take on the matter, arguing that Saylor's actions are the real culprit. In a recent note, Arca's Chief Investment Officer, Jeff Dorman, accused Saylor of 'gaslighting' the market, suggesting that the real reason for the crash was the realization that Strategy might need to sell more Bitcoin to meet its cash dividend obligations. Dorman's analysis highlights a series of missteps by Saylor, including using his only cash to pay off zero-coupon debt and then announcing a small Bitcoin sale, which is barely enough to cover one month's preferred dividends. This has left the market wondering what comes next, with Arca predicting continued drip selling from Strategy, creating steady pressure on the market. The bullish scenario, according to Dorman, would be if Saylor announced raising $2 to $4 billion to cover preferred dividends through September 2028, which would stabilize the market. However, Dorman doubts that Saylor will do this, as he is 'addicted to buying Bitcoin'. The recent selloff also showcased the growing sophistication of the market, with BTC's dominance rate falling for the second consecutive week, hitting lows under 58% for the first time since September. This indicates that investors are now assessing each digital asset on its individual risk profile, rather than indiscriminately selling everything when the market leader weakens. Despite the selloff, Arca's Dorman sees a bright spot in the fact that the initial BTC selloff was confined to Bitcoin itself and did not immediately spill over into the wider market, suggesting that market participants are becoming more sophisticated. However, Jiang Zhuoer of BTC.TOP argues that even a drop in Bitcoin's price to $30,000 would leave Strategy with relatively low leverage and little need to sell its holdings, and that speculation about Strategy dumping Bitcoin is likely overblown. Overall, the debate over the cause of the Bitcoin crash continues, with Arca and others questioning Saylor's actions and the impact on the market.
