On June 4, the cryptocurrency market experienced a new wave of aggressive selling and liquidations. Bitcoin briefly fell to $61,300, then quickly rebounded to $64,680, and is currently hovering around $62,500. Over the past two days, total leveraged liquidations across the market reached approximately $3 billion, underscoring the ferocity of the move.
Delevering Dominates: Open Interest Slides From Records
Data shows that in the last 24 hours, futures trading volume surged to $305 billion, but open interest dropped 8.5% to $111.4 billion. This divergence indicates the sell-off was primarily driven by deleveraging rather than new position building. Bitcoin open interest fell sharply from the all-time high of over 800,000 BTC seen yesterday to 766,000 BTC. The market unwound overextended leverage in a short period, which in turn amplified the downward price pressure.
Derivatives Turn Bearish: Options Market Prices in Downside Protection
Sentiment in derivatives has clearly shifted to the bearish side. Skew for both BTC and ETH put options has strengthened, signaling that investors are willing to pay higher premiums for downside protection. On Deribit, the notional open interest for Bitcoin put options at the $60,000 strike tops $1 billion, while the most actively traded option contract in the past 24 hours was the $55,000 put. This points to heightened expectations of near-term downside for Bitcoin.
Altcoins were hit even harder. NEAR, ZEC, JUP, DASH, ENA, and FET all fell more than 10%, while HYPE dropped 12% after hitting a new high earlier this week. Separately, there are signs that funds are rotating out of crypto and into AI-focused narratives in traditional markets, further draining liquidity from digital assets. The path ahead for altcoins largely depends on whether Bitcoin can hold the $60,000 level. A break below would likely trigger another wave of liquidations and exert heavier pressure on less liquid altcoin pairs.