Bitcoin Slide Sparks $1.76B Liquidation Wave; Bottoming Signal Still Unclear
Bitcoin briefly fell to an intraday low of $61,349, setting off about $1.76 billion in liquidations before rebounding toward the mid-$63,000s.
Lacie Zhang said the selloff flushed out crowded long leverage from the order book. In a June 3 report, Glassnode noted BTC dropped 13% over the past seven days, while the short-term holder cost basis slid to roughly $76,400.
Nicolai Sondergaard said both BTC and ETH saw net inflows to exchanges following the bounce. In the U.S., spot Bitcoin ETFs extended their streak of net outflows to 13 straight sessions, with about $4.4 billion withdrawn.
Standard Chartered's Geoffrey Kendrick reiterated a $100,000 Bitcoin target for year-end 2026 and warned that a break below $60,000 could spark another selling wave.
Why it matters: A leverage reset can reduce forced selling pressure, but the rebound is unlikely to be viewed as a durable floor until demand returns.
Market sentiment: Cautiously bearish, risk-off, flow-led, de-risking. The scale of liquidations suggests the move may be read as leverage cleanup rather than confirmed demand recovery.
Historical context: During the May 2021 drawdown, Chainalysis said Bitcoin fell from around $58,000 on May 12 to about $36,000 on May 19, then recovered toward $40,000, with retail selling described as the main driver. The current episode is more closely tied to ETF outflows and exchange inflows, making institutional demand the key confirmation signal.
Ripple effects: Leverage flushes can curb forced selling, but persistent spot supply may keep liquidity defensive. Continued ETF outflows and exchange inflows would weaken the case for a demand bottom. A cleaner recovery would likely require funding to normalize without open interest rebuilding too quickly.
Opportunities: A potential entry may emerge if ETF outflows slow or reverse and exchange inflows fade, with spot buying confirming a recovery.
Risks: If Bitcoin breaks $60,000 while ETF outflows persist, trimming exposure or adding hedges could help limit downside from another forced-selling wave.
