Leverage, Strategy sale spark nearly 7% crypto drop
High leveraged long positions and a rare Bitcoin sale by Strategy triggered a near-7% market decline into June 3, erasing about $1.8 billion as BTC dipped below $66,000.
The crypto market fell nearly 7% in 24 hours into June 3, with about $1.8 billion in liquidations as Bitcoin briefly traded under $66,000. The sell-off followed stretched derivatives positions and a disclosed sale of Bitcoin by Strategy, the corporate holder led by Michael Saylor.
Derivatives and funding metrics showed elevated leverage before the decline. On June 2 the futures open interest leverage ratio rose to 2.63% and perpetual leverage reached 2.48%, the highest readings since early October 2025. Funding rates across exchanges climbed to about 0.018 on June 2, a level that indicates long positions were paying shorts to hold their bets.
The immediate catalyst came on June 1 when Strategy disclosed a Bitcoin sale, its first in years. For a firm known for accumulation, the disclosure coincided with a marked shift in online sentiment and prompted heavier spot flows to exchanges the next day.
Spot exchange inflows surged to roughly 58,617 BTC on June 2, the largest single-day inflow since mid-April and above the roughly 46,500 BTC inflow recorded in early October 2025 before that month’s cascade. Large holders were net sellers: wallets holding between 10 and 10,000 BTC reduced combined holdings by about 24,602 BTC over the prior week, a decline near 18%.
The combination of crowded long leverage and increased coin supply on exchanges produced automated liquidations that accelerated price declines across derivatives and spot markets. The price action produced a daily trading range dominated by selling on June 2 and June 3.
Analysts tracking on-chain demand wrote that overall Bitcoin demand, combining speculative and spot components, was contracting at roughly 232,000 BTC per month. Bitcoin’s market share of total crypto value stood near 58.4%, so its fall pulled other tokens lower.
Key indicators market participants are watching in the near term include futures leverage ratios, funding rates on perpetual contracts and net exchange inflows and outflows, which together measure leverage concentration and spot selling pressure.
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