Bitcoin fell to $59,175 overnight, marking its lowest level since early June, before rebounding to around $61,500 by Thursday morning, according to CoinDesk. Approximately $1 billion in futures contracts were liquidated across major cryptocurrencies, including bitcoin, ether, solana, and others, as well as tokenized stocks like Micron Technology Inc (MU) and Sandisk (SNDK).
This decline resulted in about $430 million in long liquidations for bitcoin-related futures, which are bets on price increases that were forcibly closed as the market dipped.
No particular event triggered this price movement. Since peaking at nearly $65,500 on Monday, bitcoin has dropped roughly 10%, influenced by several factors prevalent throughout the week: a hawkish Federal Reserve stance, six consecutive weeks of ETF outflows, reduced summer liquidity, and the upcoming options expiry at the end of the quarter on June 30, which traders cite as a source of market instability.
Wintermute, a key market maker, had noted $59,000 as a critical level to monitor for potential bear market signals in a report on Tuesday.
The recovery in prices was fueled by developments outside the crypto sphere. Micron Technology posted quarterly earnings that exceeded analyst expectations, resulting in a significant rise in its stock and positively impacting the broader memory chip sector.
In a separate announcement, SK Hynix revealed plans for a U.S. stock listing aiming to raise around $29 billion, which would be one of the largest public offerings to date. Samsung and Kioxia also saw their shares rise in Asia on Thursday morning.
The AI chip trade, which previously caused a 10% drop in the Kospi on Monday due to concerns over a potential slowdown in spending, has now helped stabilize the crypto market. Micron's results suggest that the demand for AI memory is based on structural factors rather than speculative trends.
As the week progresses, the end of the quarter remains a significant risk. While bitcoin's low at $59,000 has held, there are $1.6 billion in leveraged long positions concentrated just below $58,000, according to CoinGlass, indicating that a breach of this level could lead to further declines.
The upcoming PCE inflation report, which is the Federal Reserve's preferred measure of inflation, is the next piece of data that could sway the market.