TL;DR
· Bitcoin dropped to near $65,500 in early June within two days, with the crypto market cap evaporating by about $200 billion.
· Strategy sold 32 BTC for around $2.5 million in late May, and the sharp decline was difficult to explain based on the trading volume on major exchanges.
· Continued ETF outflows, Mt.Gox transfers, and leveraged long liquidations compounded, suppressing the rebound due to fund outflows.

In early June, Bitcoin briefly fell below $66,000, retracting about 10% within two days. The market quickly pointed fingers at Michael Saylor-led Strategy, as this company had sold 32 bitcoins in late May. However, in terms of scale, this roughly $2.5 million sell-off appeared more like noise and was insufficient to explain the crypto market's approximately $200 billion value evaporation. The actual driving force behind the price decline was the successive redemptions of the U.S. Bitcoin spot ETF, anticipated selling pressure from Mt.Gox's large transfers, and the chain reaction following the centralized liquidation of highly leveraged long positions. Meanwhile, AI funding and large tech assets continued to attract risk capital, putting pressure on crypto assets through a more concentrated round of unwinding.

32 BTC Couldn't Withstand a Global Sell-off

Amid this decline, the most easily spread narrative was "Saylor sells, market crashes." However, the trading volume does not support this causal chain.

According to reports from The Block and Coindesk, Strategy sold 32 BTC between May 26 and 31, 2026, amounting to approximately $2.5 million at an average price of around $77,135. For a company that has long been a high-profile Bitcoin holder, this move is symbolic, but in terms of market liquidity, the scale is small.

The average daily spot trading volume of Bitcoin on major exchanges is usually in the tens of billions of dollars. Roughly calculated at the time, the sale of 32 BTC over five trading days accounted for only a tiny proportion of the daily spot volume, akin to a larger investor's unwinding, rather than a sell-off significant enough to alter the global Bitcoin price.

The price itself experienced much larger fluctuations. In early June, Bitcoin first dropped by about $4,500 in a single day, then continued to decline during the Asian and European trading sessions, hitting near $65,500 during intraday trading, marking a low not seen since late March. Ethereum also briefly fell below $1,900, with Strategy-related stocks simultaneously under pressure.

Attributing the drop to 32 BTC is more like the market seeking an easily understandable label in hindsight. The real question is why more funds chose to exit the crypto assets at the same time.

ETF Redemption and Mt.Gox Transfer Dampen Expectations

The first layer of pressure in early June came from the spot market funding.

The U.S. Bitcoin spot ETF experienced a rare streak of consecutive outflows at the time. While data sources slightly vary, according to multiple media outlets, as of early June, the outflow streak stretched to around 13 trading days, with a total net outflow of approximately $4.4 billion, causing a significant drop in the related ETF's assets under management from the previous peak. Ethereum-related products also saw continuous outflows, indicating that funds were not just exiting from a single product but reducing exposure to the overall crypto asset class.

The second trigger was Mt.Gox.

According to Coindesk, at 04:47 UTC on June 2, the Mt.Gox bankruptcy trustee transferred 10,422.65 bitcoins, worth around $739 million. The on-chain data platform Arkham Intelligence flagged this transfer, with approximately 10,306 BTC going to a previously unseen wallet address and 116 BTC going to a known Mt.Gox hot wallet. This was the largest-scale transfer by the trustee in about six and a half months.

These coins did not directly enter an exchange and cannot be equated to being sold. A more prudent interpretation is that wallet consolidation or distribution preparation is underway. However, traders usually do not wait until actual selling occurs to adjust their positions. Mt.Gox still holds about 34,504 BTC, worth about $2.43 billion, with the distribution deadline extended to October 31, 2026. Any large transfers will amplify concerns about potential selling pressure in advance.

When ETF redemptions coincide with the Mt.Gox transfer, the buying pressure on the Bitcoin spot side weakens, and the market's sensitivity to future supply quickly rises.

AI Funding Frenzy Intensifies Fund Diversions

This downturn also occurred against another backdrop: AI and large tech companies are attracting a large amount of venture capital.

On June 1, Alphabet filed an SEC document outlining plans for a $80 billion-level equity financing, including a $30 billion underwritten offering, a $40 billion ATM offering, and a $10 billion private placement to Berkshire Hathaway. Goldman Sachs, JPMorgan, and Morgan Stanley are participating in the underwriting. Berkshire's existing Alphabet shares valued at about $20 billion will increase to around $30 billion after the transaction.

SpaceX also advanced its large IPO in June. According to Axios, SpaceX completed pricing on June 11, raising $75 billion, with a valuation of approximately $1.77 trillion. AI companies such as OpenAI and Anthropic have also been long positioned for large-scale fundraising and IPO.

This flow of funds cannot be simply attributed as a direct cause of the Bitcoin downturn, but it constitutes internal competition within risk assets. Some institutions project that the AI capital expenditure of large tech companies could reach the level of hundreds of billions of dollars by 2026. In this environment, incremental funds are prioritized to flow into AI, semiconductor, and large-cap tech stocks, meaning that Bitcoin proxy assets, ETH, SOL, and other crypto assets face higher fund outflow pressure.

This also explains the market divergence at the time: traditional risk assets and the AI chain still saw buying interest, while crypto assets were being sold off for de-risking. The market was not entirely hedging but rather reordering different risk assets.

Leveraged Longs Amplify the Downtrend into a Stampede

If there were only outflows of funds and expectations of selling pressure, Bitcoin might have just experienced a continuous downtrend. In early June, it dropped by about 10% over two days, with the key factor being the concentration of leveraged positions being liquidated.

According to Coindesk citing data from CoinGlass for the same period, the cryptocurrency market's liquidation volume in 24 hours was approximately $18.4 billion, with long liquidations accounting for about $16.6 billion and short liquidations for about $1.8 billion. Around 277,000 traders were liquidated in a single day. Bitcoin long liquidations alone nearly reached $9 billion, combined with the previous day's liquidation volume, forming the largest deleveraging cycle since February.

The mechanism is not complicated. The spot price is first pushed down by funding pressure, triggering margin calls for high-leverage longs in the perpetual swap market. Exchanges automatically close positions, which then create new selling pressure. As the price continues to decline, the next layer of long positions is forced to liquidate, leading to an expanding stampede.

This is also why selling 32 BTC is not enough to explain the crash, but when combined with ETF redemptions, Mt.Gox transfers, and leverage liquidations, it is enough to magnify a single downturn into a short-term plunge. Spot pressure provides direction, while derivative positions provide speed.

Technical Signals Approaching Post-Downtrend Phase, But Selling Pressure May Not End

The sharp drop in early June does not mean that Bitcoin has entered a new deep bear market, nor does it mean that the bottom will immediately appear.

From a price perspective, Bitcoin once approached the March candlestick closing low around $65,771. If the subsequent price breaks below this area but the weekly RSI does not concurrently drop below the March low, the market may form a bullish divergence of "price makes a new low, but momentum does not." A similar structure appeared in the bottom area after the 2022 FTX crisis.

The cyclical perspective also provides a reference point. The significant lows of the previous cycles have generally occurred in the 700 to 900 days range post-halving. Currently, with about 770 days to go until the next halving in April 2024, we have entered a historical time window that is prone to signaling a late-stage correction.

However, these observations only indicate that the downtrend has reached a more critical phase and do not necessarily imply a reversal. Cycle bottoms tend to be a process rather than a single candlestick. Even if the price finds support around $65,000, it could still continue to experience consolidation, intermittent dips, and churning of ownership.

The most noteworthy aspect of this recent freefall is not Saylor selling 32 bitcoins but the crypto market experiencing a cascade liquidation triggered by capital outflows, ETF redemptions, potential selling pressure, and overleveraged positions. As long as funds continue to favor AI and large-cap tech assets, the crypto market, even in the presence of a technical rebound, will require a longer period to demonstrate that the selling pressure has been absorbed.

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