Personally, I was a bit taken aback when I checked my balances at the weekend to see that there had been another crash on the market. I actually thought we were consolidating and looking to start springing upwards again later in the year, but it seems I was wrong (for now at least). It seems that I am not the only one who got the wobbles - although I am not shifting my hodl the hell out of my BitcCoin position. I, at least have the peace of mind, that goes with the fact that I never invested anything I couldn't afford to lose.
However, from what I have read it seems that this most recent of collapses has wobbled the confidence of many "never sell your BitCoin" investors. For example, Michael Saylor’s company Strategy sold 32 BTC; admittedly not a lot, but symbolically it said a lot. It was their first sale in years and this on its own created a fracture in the “we only buy” narrative and we must remember that markets react more to narratives than numbers — and this narrative broke confidence which consequently triggered fear and accelerated selling.
This explains to some extent the ensuing cascade, but what was behind it? Cause and effect means a deeper dive and going further back to see what happened. From what I have read, and as always while Alts are down too - following the same pattern - it started with BitCoin; which almost always tends to be the trend setter. I think in my crypto experience, only once did Ethereum lead the way and that a was few years ago. It seems that multiple pressures hit at the same time and therefore no single cause can be identified.
The evidence spoke for itself though. Falling from the mid‑$70Ks in late May, to the low‑$60Ks and briefly below $60K between June 4–9 BitCoin hit a major bump in the road which could be classified as a perfect storm.
The primary cause was the massive EFT outflows as investors either cashed in or dumped (more likely) there BitCoin (see above as an example). Some sources have shown that there was a net EFT outflow, for 13 consecutive days, which represents the longest streak of 2026. Last month (May 2026) saw outflows hit $2.30 billion and by 3 June that cumulative figure had hit $4.33 billion with another $1.1 billion being pulled out on that day alone. Just like any economic supply and demand dynamic this flipped the market into what could be called supply shock.
What followed though over the next few days was a continuation of the same momentum as BitCoin experienced a massive liquidation cascade (with another $3billion being wiped out in hours). 85% of liquidations that followed were from investors holding long positions and this was the window in which Strategy (Michael Saylor) moved decisively against the "never sell your BitCoin" position which, as already stated, changed the narrative and triggered panic which was further exacebated when BitCoin dipped below key support levels; forced selling then triggered more forced selling and low and behold we were caught in a classic cascade.
Mt. Gox, the Tokyo-based exchange that managed upto 70% of BitCoin transactions in the early days moved and astronomical 10,422 BitCoins on June 2 ahead of an October 2026 repayment deadline and while they weren’t sent to exchanges, the movement created a massive supply shock and just like with the old adage "when America sneezes the world catches a cold", every time Mt. Gox coins move, markets panic — and this time was no different.
We cannot underestimate the impact of geopolitical & macro shocks. The first week of June saw Hezbollah reject an Israeli ceasefire offer (although that seems to be moving now after further Iranian strikes on Israel and Israel's response earlier in the week), the U.S. and Iran saw a new escalation with new military strikes the same week and away from conflict and a couple of months ago (April) the U.S. Consumer Price Index came in hot (higher inflation), which in turn reduced expectations of Fed rate cuts. It also meant people (including investors) needed more money in their pockets for day to day living cost and it appears that this factor alone is what triggered the 13‑day ETF outflow streak. All in all we must remember that crypto is highly sensitive to macro fear, and June delivered plenty.
Within this group of investors who offloaded their BitCoin we saw for the first time in months long‑term hodlers dumping their BitCoin ~$2.4 billion worth of BTC in early June. Many of these had bought above $90K and capitulated to get out before things got worse. The fact is that when when long‑term hodlers sell, it signals deep market stress. One, slightly more obscure reason could be the realignment of investment funds. The fact is that the Nasdaq was up 43% Year on Year while crypto fell and that simply makes "traditional" investment a more lucrative prospect. What may well have happened is that speculative capital rotated out of crypto into booming AI stocks and the anticipated $1.8 trillion SpaceX IPO and while this didn’t cause the crash, it certainly weakened the buyer base.
So, that is what I have been able to find out and please remember I am not an expert so always DYOR. What I have not included is what happens next. Sadly, I am not a soothsayer and so therefore I don't know what the next chapter holds.
As always stay safe and well my friends.
