Bitcoin’s Worst Week Since FTX: $59K, $1.6B Wiped
Bitcoin touched $59,100 on June 5, 2026, its lowest print since October 2024, as a convergence of macro shocks, leveraged liquidations and capital rotation produced the asset’s worst seven-day decline since the FTX collapse of November 2022. The week erased roughly $390 billion from total crypto market capitalisation, dragged Bitcoin down 17.3% and Ether 22%, and pushed the daily RSI to approximately 15.5, a reading not seen since the COVID-19 crash of March 2020. At time of writing, Bitcoin has recovered to $62,210, up 2.04% over the past 24 hours, but the structural questions raised by this drawdown are not resolved by a single session of stabilisation.
How a Jobs Report Became a Crypto Catalyst
The proximate trigger for Friday’s sharpest leg lower was a stronger-than-expected U.S. nonfarm payrolls report, which prompted a swift repricing of Federal Reserve expectations. Swaps markets moved to fully price a rate increase by year-end 2026, reversing months of anticipation for cuts under newly confirmed Fed chair Kevin Warsh. Two-year Treasury yields climbed 12 basis points to 4.16%, the dollar firmed, and risk assets sold off broadly. The Nasdaq 100 fell approximately 5%, its steepest single-day decline since the tariff-driven episode of April 2025, while a gauge of semiconductor stocks dropped 10% after Broadcom trimmed its AI chip sales forecast for the second half of the year.
Bitcoin did not fall in isolation. It fell alongside every major risk asset class simultaneously, which tells you something important about the nature of this drawdown. When rates reprice hard and the dollar strengthens in a single session, crypto liquidity is among the first to thin, because it trades continuously and carries no circuit breakers. The mechanics are unforgiving in that environment.
The Anatomy of $1.6 Billion in Forced Selling
The price action below $60,000 was not primarily a spot-driven event. According to CoinGlass data, approximately $1.6 billion in leveraged crypto positions were liquidated within a single 24-hour window, affecting an estimated 308,000 traders. Longs accounted for roughly $1.21 billion of that total, reflecting the one-sided positioning that had built up through the preceding weeks. Bitcoin alone saw $534 million in liquidations; Ether contributed $423 million. Zcash, already reeling from a disclosed vulnerability in its Orchard privacy pool, added another $115 million to the tally as the token collapsed more than 44%.
The broader weekly figure is considerably larger. CoinGlass data cited by multiple outlets puts total crypto leveraged liquidations for the week at approximately $7 billion, with Monday and Friday delivering the heaviest flushes. Of that, roughly $5.7 billion represented long positions. Futures open interest across the market fell 8.5% to around $111.4 billion as the leverage was cleared, according to CoinDesk. As CryptoDaily’s breakdown of the liquidation mechanics noted, the distribution of losses matters as much as the headline number: when retail perpetual traders hold the bulk of the leverage, the aftermath tends to produce funding normalisation and calmer price action, rather than a sustained trend continuation.
Jean-David Péquignot, chief commercial officer at Deribit, had flagged the $60,000 level as structurally consequential even before the break, warning that notional open interest in Bitcoin put options at that strike exceeded $1.2 billion on Deribit alone. Market makers short those puts are short gamma, meaning their hedging requirements accelerate as spot falls. Once the level broke overnight, those dealers were compelled to sell spot Bitcoin or futures to stay delta-neutral, compounding the momentum-driven selling already underway.
Capital Rotation, Not Capitulation
Several analysts have resisted the framing of this week as a collapse in Bitcoin conviction, arguing instead that the selling reflects where capital is going rather than a loss of faith in the asset. Jeff Park, chief investment officer at ProCap BTC and a former Bitwise advisor, characterised Bitcoin as a liquidity source being tapped to fund “the market’s upcoming hot ball of money trades,” citing anticipated IPOs from SpaceX, Anthropic and OpenAI as the primary destinations. The argument has structural logic: Bitcoin’s market depth and continuous trading make it the most convenient asset to liquidate when an investor needs to raise cash quickly, regardless of their long-term view on the asset.
CryptoQuant’s Ki Young Ju offered a complementary perspective, framing Strategy’s approximately 700,000 BTC accumulation as a stabilising force rather than a source of risk. His reading is that Strategy’s institutional demand has absorbed supply that would otherwise have driven the price toward a potential structural floor near $22,000, counterbalancing the roughly 1.24 million BTC that longer-term whale cohorts have distributed into the market over recent months. That is a contested thesis, but it is grounded in observable on-chain flows rather than sentiment.
The capital rotation argument was reinforced by the ETF data. Spot Bitcoin ETFs recorded $326 million in net outflows on June 5 alone, resuming pressure that had briefly paused one day earlier. As documented through a 10-day record outflow streak heading into this week, total ETF redemptions since mid-May had already exceeded $5 billion before Friday’s report hit. Vetle Lunde of K33 Research attributed a portion of those outflows to rotation into AI-related equities, arguing that the opportunity cost of holding Bitcoin had risen materially as AI stocks pushed to record highs.
The Strategy Sale and the Narrative Damage It Caused
The week began with a disclosure that did disproportionate psychological damage relative to its economic size. Strategy, the largest corporate holder of Bitcoin, revealed it had sold 32 BTC for approximately $2.5 million between May 26 and May 31, its first documented divestment since late 2022. The transaction was operationally trivial against a holding of roughly 700,000 BTC, but it shattered the perception of Strategy as a permanently accumulating buyer, which had been one of the more durable demand narratives sustaining institutional confidence. For an asset that relies heavily on conviction-based holding, the symbolism was damaging independent of the economics. The broader implications for Strategy’s preferred equity financing model, which requires the stock to trade above certain levels to remain viable as an issuance vehicle, were also scrutinised by investors during the week. The stress test had arrived, and while it did not break the model, it demonstrated its sensitivity to sustained price weakness.
RSI at 15.5: What Historical Analogues Actually Show
Bitcoin’s daily RSI of approximately 15.5 at the weekend low is not a number that appears often. The last comparable reading was March 2020, when the COVID crash drove Bitcoin from roughly $9,000 to below $4,000 in days. In February 2026, when the RSI touched a similar oversold extreme, Bitcoin subsequently rebounded approximately 30%. The March 2020 episode produced a recovery of over 50% from the lows. Those are not guarantees, but they establish a base rate for what extreme RSI readings have historically preceded in this asset. Cointelegraph cited analysts placing a $70,000 rebound target within the coming weeks on the basis of those two precedents.
The technical picture is more complex than the RSI alone. Bitcoin is testing its 200-week moving average, a level that has functioned as a floor of last resort across multiple cycles. The 2015, 2018 and 2020 macro bottoms all formed on or near it. The exception was 2022, when the line broke and Bitcoin spent several months beneath it, ultimately reaching $15,500. Analyst Rekt Capital noted the timing: Bitcoin tagged its 200-week average in June 2022 and has now done so again in June 2026, almost four years on. The rainbow chart has also broken to the downside for only the second time in recent history, with the first occurrence coinciding with that same 2022 bear market trough.
Three overhead resistance levels now define what a recovery would need to clear: the 21-week simple moving average at $75,100, the short-term holder cost basis at $77,000, and the 200-day moving average at $78,900. All three functioned as support during the preceding bull phase and have since inverted to resistance. Until Bitcoin closes a week above $78,900, the structural case for a sustained recovery requires more evidence than a single oversold bounce.
The Short Squeeze Scenario and the Bear’s Exposed Flank
The positioning reset created by this week’s liquidations has an important asymmetry that is being underweighted in the bearish consensus. Perpetual futures funding rates have turned negative, reaching approximately minus 2% annualised, which means bears are now paying to hold short exposure. A neutral funding range is typically 6% to 12% annualised with longs paying. This inversion confirms that long leverage has been largely cleared from the system. It also means that the next directional catalyst, if it comes from the upside, will hit a book that is now skewed short.
CoinGlass data shows approximately $2.6 billion in short positions concentrated in the $63,000 to $66,000 range. A move from current levels near $62,000 to $66,000 would put all of that exposure at risk of forced covering. By comparison, a further 8% decline to $57,000 would liquidate an estimated $1.2 billion in remaining longs. The asymmetry is real and quantifiable: the next $4,000 of upside threatens more than twice the leveraged capital as the next $5,000 of downside. That does not make a squeeze probable, but it means that any catalyst sufficient to push Bitcoin through $63,000 could become self-reinforcing in a way the current bearish tape has not been.
BlackRock’s purchase of approximately $33 million in Bitcoin, reported over the weekend, is a small but directionally meaningful data point. Institutional buyers with long time horizons have a history of increasing exposure precisely during extreme sentiment troughs; the Fear and Greed Index at 12, in “Extreme Fear,” is the kind of reading that precedes institutional accumulation more reliably than it precedes continued distribution.
Cycle Timing and the $40,000 Bear Case
The rotation and positioning arguments should not obscure the more uncomfortable structural scenario. Cycle analysts who track halving-based timing models note that Bitcoin reached day 775 of the current cycle this week. Every prior cycle bottomed near day 900, which places a potential cycle low approximately 125 days out, around October 2026, with analyst Jesse Olson’s chart placing the projected trough in the $40,000s. Benjamin Cowen independently arrives at the same timing, noting that Bitcoin topped on day 1,162 of the current cycle, within one week of where the prior two cycles peaked, at days 1,059 and 1,168 respectively.
Peter Schiff, consistent with his long-held structural bearishness, argued this week that Bitcoin has recorded only four negative calendar years, none consecutive. The average decline in those three prior down years was 65%. Bitcoin is currently down approximately 30% year to date from its January level. If this cycle follows historical precedent, the arithmetic produces a year-end price near $30,000. That is an uncomfortable number to write, but the historical inputs Schiff cites are accurate, and dismissing the argument purely on the grounds of his prior track record is not an analytically sound response. Polymarket contracts, as of the reporting period, assigned an 83% probability that Bitcoin trades below $55,000 at some point during 2026. At time of writing, with roughly 97,300 blocks remaining to the next halving, the supply-side dynamic remains unchanged; the issue is demand, macro and leverage.
Where the Weight of Evidence Points
The honest assessment is that this drawdown has multiple overlapping causes, not a single narrative, and that the structural forces behind it, higher real yields, capital rotation toward AI, unwinding of the post-election institutional premium, and a leveraged book that was long into a macro headwind, are not resolved in a weekend. The $59,100 low may or may not represent the cycle bottom. The RSI, the 200-week average and the negative funding rate all provide credible grounds for a short-term relief trade toward the $65,000 to $70,000 range. The cycle timing models, the overhead resistance cluster and the macro rate trajectory all argue that any such relief trade would likely be sold into, rather than sustained as a trend reversal.
The group most exposed over the next 60 days is holders who bought between $70,000 and $90,000 during late 2025 and early 2026, now sitting on losses of 25% to 45%, with rising yields eroding the opportunity cost argument that made Bitcoin attractive as a non-yielding asset in a rate-cut environment. The group best positioned is patient institutional capital with a 12-month horizon and the liquidity to average down into a $60,000 to $65,000 range; the divergence between Strategy’s sale and Strive’s concurrent accumulation illustrates exactly that split. BlackRock’s weekend purchase, however modest in dollar terms, belongs to the same category. The capital that bought this week’s dip is not speculative; it is the same cohort that bought the $74,000 low in May and the $59,000 low in October 2024. Whether that cohort is early or precisely timed depends on a Federal Reserve decision that the data, as of today, has not yet forced.
