Bitcoin Slides to Two-Year Low as $25 Billion ETF Exodus Deepens
Bitcoin fell 17% to $59,550 US amid relentless selling pressure, while major US banks unite to protect deposits from stablecoins and corporate treasuries face dividend pressures.
Bitcoin has reached its lowest valuation since October 2024, falling 17% over five days to trade at $59,550 US in afternoon trading on June 5. The decline marks the worst weekly performance for cryptocurrencies since February, driven by a souring narrative around digital assets and a complete absence of near-term catalysts to reverse the slide. The Bitcoin “fear gauge” rose more than 20% over the past week as retail investor nervousness intensified, with prediction markets such as Kalshi and Polymarket now pricing in a potential drop to $50,000 US.
The selloff has triggered a significant capital flight from regulated investment vehicles, with spot Bitcoin exchange-traded funds recording 13 consecutive days of outflows. This relentless selling pressure has resulted in a $25 billion US capital exodus from the sector. Institutional investors are increasingly cautious, with analysts warning that the lack of immediate positive drivers could prolong the downturn across the broader digital asset landscape.
Corporate balance sheets are also feeling the strain, with Strategy, formerly known as MicroStrategy, selling 32 Bitcoin for $2.5 million US. This marks the first sale of the asset by the company in four years and is being viewed as a move to fund dividend payments on its preferred stock, which yields 11.5%. While the volume sold is small relative to its holdings of more than 840,000 Bitcoin, the move signals potential liquidity pressures for corporate treasuries holding significant crypto exposure.
In a contrasting development within the infrastructure space, Hut 8 raised $17 billion US in bond orders, four times its $4.25 billion US target, to fund a 352-megawatt data centre in Texas. The facility has been leased to chipmaker Nvidia, highlighting the pivot of former Bitcoin miners toward artificial intelligence operations. Similarly, HIVE Digital Technologies reported a 158% surge in revenue to $297.8 million US for the fiscal year ended March 31, as it transitions from mining to AI data centre services.
Meanwhile, the traditional banking sector is mobilising to counter the rise of stablecoins. JPMorgan Chase, Bank of America, and Citigroup are launching a shared tokenised deposit network, internally referred to as “the bridge,” to protect their deposits. Operated by The Clearing House, the initiative aims to leverage blockchain technology to maintain the relevance of traditional bank accounts. Elsewhere, Binance shut down its NFT marketplace following a prolonged downturn in digital art trading, and Grayscale set a 0.29% management fee for its new Hyperliquid Staking ETF, undercutting competitors in the rapidly evolving exchange-traded fund market.
