The crypto market dropped nearly 7% in the 24 hours into June 3, with Bitcoin briefly breaking below $66,000 and roughly $1.8 billion in positions liquidated. The sell-off accelerated after Michael Saylor's Strategy (formerly MicroStrategy) disclosed its first Bitcoin sale in years on June 1, a move that shocked sentiment already stretched by record-high leverage ratios.
Leverage at highest since October 2025
Bitcoin's futures open interest leverage ratio hit 2.63% on June 2, and the perpetual version reached 2.48% — both the highest since October 6, 2025. That earlier peak preceded the October 10 Black Friday crash, when the ratio neared 2.73%. Traders loaded up on leverage just before this week's drop, leaving the market exposed to a sharp unwind. Funding rates across exchanges also spiked to 0.018 on June 2, the most positive single-day reading since early September, and stood at 0.017 on June 1. Positive funding means long positions were paying shorts, a sign of excessive bullishness that often precedes a flush.
Strategy's Bitcoin sale rattles sentiment
Strategy's sale of Bitcoin — its first in years — hit the market hard. Social sentiment flipped into extreme fear almost immediately after the news, with traders pointing to the sale as a main trigger. Bitcoin spot exchange inflows on June 2 reached 58,617 BTC, the highest since April 14 and well above the 46,527 BTC inflow on October 7, 2025 before the Black Friday crash. The move by Saylor's firm, which had long been the poster child for corporate Bitcoin accumulation, sent a signal that even the most committed holders are trimming.
Whales cut positions, demand shrinks
On-chain data shows whales and sharks — wallets holding between 10 and 10,000 BTC — offloaded 24,602 BTC over the past week, an 18% reduction. In contrast, the smallest traders (under 0.01 BTC) added just 61 coins. CryptoQuant head of research Julio Moreno said Bitcoin demand is contracting at roughly 232,000 BTC per month, and the correction is tied to demand conditions, not stocks, oil, or macro factors. Bitcoin commanded about 58.4% of the total crypto market cap at the time of the crash, suggesting the pain is concentrated in the largest asset.
With spot exchange inflows at their highest since mid-April and whales offloading at an 18% clip, the market faces a near-term supply glut. Funding rates, while still elevated, have begun to normalize — but the leverage unwind may not be over. Moreno's demand snapshot shows no quick rebound in buying pressure. The next few sessions will tell whether the correction deepens or finds a floor around $66,000.
