Bitcoin briefly fell under the $60,000 mark on Friday for the first time since October 2024, triggering a wave of selling across the cryptocurrency market. The digital asset has since recovered slightly to trade near $60,719, but the dip has raised fresh concerns about the sustainability of the rally that followed the 2024 U.S. elections.
The sell-off was fueled by a combination of factors, including heavy outflows from spot bitcoin exchange-traded funds (ETFs) and a rare, albeit small, sale by Strategy, the corporate bitcoin treasury firm led by Michael Saylor. According to data from Farside Investors, spot bitcoin ETFs saw approximately $4.4 billion in net outflows between May 18 and June 5, marking one of the largest withdrawal periods on record.
Strategy, which holds the largest corporate bitcoin stash, disclosed its first bitcoin sale since 2022. While the sale amounted to just 0.004% of its total holdings, the move was seen as symbolic and added to the bearish sentiment in a market already short on buyers. Shares of Strategy, along with other crypto-linked stocks such as Coinbase, MARA, and Riot, also declined, reflecting the broader risk-off mood.
Bitcoin's drop below $59,750 erased all of its post-election 2024 gains, according to TheStreet. That level is now being closely watched by traders as a key support. Analysts warn that a sustained move below it could trigger additional selling pressure and potentially lead to a deeper correction.
Peter Schiff, chief economist at Euro Pacific Asset Management and a longtime gold advocate, warned that a break below Friday's low could spark what he described as a "Crypto Black Monday." However, not all on Wall Street are bearish. Geoffrey Kendrick, Standard Chartered's global head of digital assets research, reiterated his year-end bitcoin target of $100,000, calling the current dip a potential "buying zone."
Long-time crypto analyst Bob Loukas offered a more cautious outlook, suggesting bitcoin is in the final phase of its four-year cycle. He pointed to $53,000 as the level where his model portfolio would return to full bitcoin exposure, but sees a cycle low more likely around October or November. Bitcoin is currently in month 43 of its cycle, approaching the period where four-year lows have historically occurred.
Adding to the headwinds, Reuters reported that bitcoin is on track for its weakest year-to-date performance in at least a decade, as institutional capital rotates into artificial intelligence stocks and initial public offerings. Stablecoins and other tokens are also eroding bitcoin's share of the broader cryptocurrency market.
The key risk for bitcoin remains straightforward: if prices slip back below the high-$50,000s, technical selling and further ETF outflows could compound the decline. Conversely, if bitcoin can hold above $60,000 and ETF outflows begin to ease, the market may test whether Kendrick's "buy zone" thesis holds, especially with short positions building after the sharp move lower.
