Market Cap and Liquidation Crunch
Bitcoin’s poor start to June continued as the cryptocurrency tumbled below $67,000, hitting another multi-week low. The daily chart shows bitcoin steadily declining from just over $71,500 late June 1 to an intraday low of 66,346, a loss of more than 6% in 24 hours.
The slide means bitcoin shed nearly $7,000 in the first two days of June alone, while the decline on June 2 dragged its market capitalization down to just under $1.35 trillion. The poor run also helped pull the crypto economy’s aggregate market capitalization below $2.5 trillion for the first time since April 13.
The sell-off triggered the wipeout of $800 million in leveraged positions, with long bets alone accounting for nearly $767 million. Overall, long positions liquidated across the cryptocurrency market crossed the $1.35 billion mark, while only $136 million in short bets were liquidated. According to Coingecko, the June 2 liquidations are the largest so far in 2026.
Initially, the sell-off was attributed to Strategy’s disposal of 32 bitcoins, a sale some insist should not have happened. Despite representing less than 1% of Strategy’s total holdings, the sale has been interpreted as a signal that the company is abandoning its buy-only policy.
However, other observers believe bitcoin’s price action will follow its historical pattern. According to the latest K33 Research report, crypto markets — particularly bitcoin and ether — often experience a notable decline in trading volume, liquidity, and volatility during the summer months, from June through August. With institutional and retail traders on vacation, market participation drops, leading to sideways price action or downward-trending price action.
Bit Paine, executive chairman of Vibes Capital Management, rejected the notion that Strategy’s sale of 32 BTC caused the downward spiral. In a post on X, Paine instead offered an alternative view on why bitcoin is tanking.
“ Bitcoin is dropping because we are within a structural correction within a bear market, and this is what happens to volatile assets in bear markets. Iran negotiations breaking down and AI / SpaceX sucking the air out of the capital markets are contributory — Bitcoin does not exist in a vacuum — but not causal. Narrative follows price,” Paine said.
David Gokhshtein said he expects bitcoin to go even lower before it eventually bounces while Eric Balchunas, a senior ETF analyst at Bloomberg, insists that bitcoin has become too dependent on the ETF and MSTR narrative.
