Bitcoin Hits $61,300 — Its Lowest Since February — as $1.6 Billion in Positions Are Liquidated

Bitcoin fell to $61,300 in early Thursday trading — a four-month low — before recovering to approximately $64,000 by midday in New York. The move down was violent enough to liquidate $1.6 billion in leveraged positions across cryptocurrency markets in a single 24-hour period, wiping out roughly 270,000 traders. The Bitcoin Fear and Greed Index sat at 11, deep in "Extreme Fear" territory, as the market processed a convergence of pressure points that had been building for two weeks.

At the intraday low, Bitcoin was 22.7% off its four-week high, meeting the technical definition of a bear market. The RSI touched 17 — deeply oversold by any standard measure. The price sat well below the 200-day exponential moving average at approximately $80,500. For a market that had reached an all-time high of $126,198 in October 2025, Thursday's print represented a 51% drawdown from the peak.

Why it happened: four simultaneous pressure points

No single trigger explains the size of the move. The more useful analysis comes from understanding what had been accumulating since mid-May.

US spot Bitcoin ETFs have now recorded 13 consecutive trading days of net outflows — a new all-time record, surpassing the previous eight-day streak from February 2025. Total outflows across the 13-day period reached approximately $4.4 billion. BlackRock's IBIT accounted for roughly $3.3 billion of that, despite still holding 786,800 BTC. Fidelity's FBTC and Grayscale's GBTC contributed the remainder. Total ETF assets under management fell from $104 billion on May 15 to $82.8 billion by June 3 — a $21 billion decline in three weeks.

The second pressure point was psychological rather than mathematical. Strategy — the company formerly known as MicroStrategy and the world's largest corporate Bitcoin holder with 843,706 BTC — disclosed in a June 1 Form 8-K that it had sold 32 Bitcoin between May 26 and 31 at an average price of $77,135, raising $2.5 million to fund dividend payments on preferred shares. The sale itself was trivial relative to Strategy's holdings — 32 coins is a rounding error when you own 843,706. But it was the first Bitcoin Strategy had sold since late 2022, and the timing "fit the bearish naysayer thesis," in the words of Standard Chartered's Geoffrey Kendrick. Traders who had treated Strategy's permanent accumulation as a fundamental signal were rattled by the exception.

The third factor is structural: capital rotation. Michael Saylor himself described it on X as AI infrastructure investment competing with Bitcoin for institutional capital. "Capital markets are funding the AI buildout at historic scale: approximately $400 billion over six months. Bitcoin ETFs have seen approximately $4 billion of outflows since May 14. This is a capital rotation, not a Bitcoin impairment." Wall Street analysts estimated combined hyperscaler AI capex above $600 billion for 2026. The same institutional investors choosing between a Bitcoin ETF position and an Nvidia or Broadcom infrastructure position are, on the margin, choosing infrastructure.

The fourth element is geopolitical. The ongoing US-Iran conflict that began in late February 2026 had given Bitcoin an earlier "geopolitical premium" — the price spiked toward $74,000 following a US-Israel airstrike on Iran. By June 4, that premium had been entirely retraced. Joel Kruger of LMAX described the macro environment as "a fragile mix of Middle East geopolitical risk, sticky inflation, Fed uncertainty, and the AI investment boom" keeping speculative bids cautious with the Federal Reserve's June 16 meeting approaching.

The scale of the damage across crypto markets

Bitcoin's $61,300 low dominated headlines, but the broader market absorbed proportionally larger losses. Ethereum fell to $1,730, its lowest level since April 2025 — a 14-month low — before recovering to approximately $1,809. Ethereum is down roughly 32% year-to-date against Bitcoin's approximately 30% decline from its 2026 peak, and the ETH/BTC ratio hit a 10-month low. Solana fell to $66, its weakest since December 2023, down 17% on the day and roughly 74% from its 2025 peak.

Of the $1.6 billion in liquidations, Bitcoin long positions accounted for approximately $735 million, Ethereum longs approximately $350 million, and the remainder spread across altcoins. The largest single position liquidated was a trade on Hyperliquid worth more than $16 million. Total crypto market capitalisation fell 6.26% to approximately $2.17 trillion — over $600 billion in market value erased.

One notable outlier: Hyperliquid's HYPE token was trading near its all-time high of $75.76 and gained roughly 4% on Thursday while the rest of the market collapsed, a divergence that market observers attributed to the exchange's strong recent revenue performance and growing open interest.

On-chain signals: who was selling

CryptoQuant data showed approximately 53,800 BTC sent to exchanges at a loss by short-term holders — a classic capitulation signature. Long-term holders contributed $1.35 billion in realised losses. Whale wallets holding between 1,000 and 10,000 BTC had sold nearly 25,000 BTC in the week prior to Thursday's drop.

CryptoQuant founder Ki Young Ju offered a longer-term frame: the selling represents a supply transfer from early Bitcoin holders — what he called "OGs" and "cypherpunks" — to US institutional investors. Bloomberg ETF analyst Eric Balchunas echoed this, attributing the selling pressure primarily to early holders rather than the institutional ETF buyers, whose positions remained largely intact. CryptoQuant head of research Julio Moreno noted that overall Bitcoin demand had dropped approximately 501,000 BTC over the prior month — the fastest monthly demand contraction since the Terra/Luna collapse in May 2022.

Recovery and what comes next

Bitcoin's recovery from $61,300 to approximately $64,000 by midday Thursday was sharp enough to form what some technical analysts described as a potential pin-bar reversal — a candlestick pattern associated with exhaustion of a downtrend. Whether that reversal holds depends substantially on two upcoming events: the June 6 US jobs report, and the Federal Reserve's June 16-17 meeting. If jobs data comes in weaker than expected and raises the probability of a rate cut, risk assets including crypto could see meaningful relief. If the data supports the Fed holding steady or signals tightening, the fragile recovery is likely to be tested again.

Bear-case technical targets cited by analysts include $49,000 based on Fibonacci extension analysis and $44,000 to $45,000 based on the August 2024 consolidation lows. The $60,000 level — briefly tested in February 2026 — is the near-term support level that most analysts consider structurally important. A sustained break below it would represent the third test of that range in 2026 and would meaningfully change the technical picture for the year.

Bitcoin's story in 2026 has been a study in how a maturing asset class absorbs competition for institutional capital. The same investors who drove BTC to a $126,000 all-time high in October 2025 are, in 2026, also funding Nvidia's $3 trillion market cap, Anthropic's $40 billion valuation, and $600 billion in annual AI infrastructure spending. Whether Bitcoin can hold its position as the dominant alternative asset allocation, or whether it yields share to AI infrastructure equity as the decade's defining institutional trade, is the question that Thursday's crash made considerably more urgent.