Crypto market hit by $1.7 billion liquidations as Bitcoin slides to $66,500
Crypto market hit by $1.7 billion liquidations as Bitcoin slides to $66,500
Bitcoin fell to $66,500 on June 2, sparking a broad selloff across digital assets and triggering roughly $1.7 billion in liquidations, mostly from leveraged positions. Ethereum dropped below $1,900, losing 8 percent in 24 hours, while an estimated $1.5 billion of long positions were forcefully closed as margin calls and automated selling kicked in.
ETF outflows deepen, link to equity markets tightens
Pressure on Bitcoin was compounded by accelerating withdrawals from U.S. spot ETFs. Data show $483.8 million exited Bitcoin spot ETFs in a single day at the start of June, extending an 11‑day streak of net redemptions. May recorded $2.3 billion in net outflows, the largest monthly withdrawal since November 2025, reversing the strong inflows of March and April, which drew $1.32 billion and $1.97 billion respectively.
Updated figures indicate that around $2.8 billion has left spot Bitcoin ETFs over a recent nine‑day window, with BlackRock’s IBIT product alone seeing a single‑day outflow of about $440 million. The speed of these redemptions suggests larger capital allocators are cutting exposure more aggressively than the underlying price decline would imply.
At the same time, Bitcoin’s price remains tightly coupled to traditional equity benchmarks. Its correlation with the Dow Jones Industrial Average stands near 84 percent, underscoring how macro themes such as inflation data and interest rate expectations continue to drive crypto performance alongside stocks.
Leveraged flush accelerates downside
The move to $66,500 was amplified by market structure rather than spot selling alone. Automated stop‑loss orders and the unwinding of leveraged positions cascaded across major venues once key support levels broke, forcing liquidations that pushed prices lower in a feedback loop.
The scale of forced liquidations highlights how the use of borrowed capital magnified the decline. As prices fell and maintenance margins were breached, exchanges closed positions into a thinning order book, intensifying both the speed and severity of the drop.
Ethereum faces seasonal and technical headwinds
While the broader market sold off, Ethereum’s price action is drawing separate scrutiny. Historical data show June has been Ethereum’s weakest month, with negative returns in seven of the past ten years. Some chart‑based models now flag the $1,800 zone as a key support area, suggesting the token could drift toward that level if selling pressure persists through the month and macro conditions fail to stabilize.
Hyperliquid rallies through turmoil, unlock test ahead
Against the risk‑off backdrop, Hyperliquid (HYPE) briefly reached a new all‑time high of $75.51 before pulling back to around $68. The token is still up about 15 percent over the past week, with a market capitalization of $15.9 billion and daily trading volume of $1.54 billion, placing it tenth among global digital assets by size.
HYPE recently overtook Dogecoin in market value and is now heading into a key supply event. The project plans to release 9.92 million tokens—worth roughly $684 million at recent prices—on June 6, equal to 2.54 percent of the circulating supply. The unlock will test whether current demand can absorb new supply without triggering a deeper correction.
Some large capital managers appear comfortable with that risk. Bitwise has increased its exposure and now holds around $55 million worth of HYPE staked, signaling growing institutional engagement even as broader crypto sentiment wobbles.
Zcash breaks higher on regulatory clarity and upgrade roadmap
Zcash (ZEC) emerged as the standout outlier. The privacy‑focused token climbed more than 7 percent on the day, touching an intraday high of $628. Its market capitalization briefly exceeded $11 billion, placing it just outside the top ten and ranking it eleventh among major cryptocurrencies.
The rally followed confirmation that the U.S. Securities and Exchange Commission had closed its review of the project without taking enforcement action, removing an overhang that had weighed on sentiment. From its February low near $185, ZEC has now gained about 270 percent.
On‑chain data point to rising demand for privacy features. The number of shielded addresses on the network has increased from 1.47 million in 2024 to 5.11 million, signaling a sharp pickup in usage of Zcash’s core functionality.
Technically, ZEC is now trading around a key support area. If the token can continue to hold above $500, chart watchers see the next major resistance level near $642. Beyond short‑term price levels, the project has outlined a multi‑year upgrade path. The first testnet for the NU7 upgrade went live on May 22, targeting a tripling of transaction speed by cutting block times from 75 seconds to 25 seconds.
Network governance voting on NU7 is expected to begin in June 2026, setting a longer‑term timetable for protocol changes that could further shape Zcash’s competitive position in the privacy segment.
What traders are watching next
- Whether Bitcoin spot ETF outflows stabilize or extend, as continued redemptions could keep pressure on prices.
- How Ethereum behaves around the $1,800 support band during what has historically been a weak month.
- Market reaction to the June 6 HYPE token unlock, which will reveal how much real demand underpins the recent rally.
- ZEC’s ability to hold above $500 and maintain momentum as NU7 development advances and regulatory clarity improves.
Worried about Bitcoin’s sharp drop and liquidations? Learn how to navigate a crypto crash and protect your portfolio.
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