Gate Research: ETF Outflows Trigger Market Pullback, Long Liquidations Accelerate Crypto Market Deleveraging

Summary

• BTC experienced a sharp pullback over the past 24 hours, briefly falling toward the $62,000 level. Spot Bitcoin ETFs recorded a single-day net outflow of $519.1 million, marking a recent high. Combined with expectations of potential Strategy selling, market risk appetite cooled significantly.

• ETH underperformed expectations overall, falling below key short-term moving averages and remaining under pressure below the $1,850 level. ETH ETF fund flows also remained weak, with bears continuing to dominate the short-term market structure.

• The total crypto market capitalization declined by approximately 4.4% in a single day, while the Fear & Greed Index dropped to 19, entering the Extreme Fear zone. However, the AI sector outperformed the broader market, with tokens such as WLD and MAGMA leading gains, highlighting clear structural divergence in capital flows.

• Total crypto liquidations reached $1.74 billion over the past 24 hours, including approximately $1.54 billion in long liquidations. Meanwhile, total derivatives open interest declined to around $432.39 billion, indicating that the market's deleveraging process remains ongoing.

• A total of 13 funding rounds were disclosed this week, primarily concentrated in cryptocurrency exchanges and institutional-grade financial infrastructure. Dunamu, Coinone, and SignalPlus ranked among the largest fundraising projects by disclosed amount.

• Approximately $884 million worth of token unlocks are expected over the next seven days, with HYPE, HOME, and ENA being the key projects to watch.

Market Overview

Market Commentary

• BTC Market Update — Over the past 24 hours, BTC traded between $62,452.8 and $67,503.5, shifting from a period of consolidation into a clear downside breakdown. No structural failure occurred within the Bitcoin network itself; rather, ETF outflows were the primary catalyst behind the decline. On June 2, spot Bitcoin ETFs recorded net outflows of $519.1 million, marking the largest single-day withdrawal in recent weeks. Reports that Strategy is reducing its BTC holdings have further undermined market confidence. On the hourly chart, MA5 stands at $64,124.2, MA10 at $64,913.9, and MA20 at $65,935.3, with short-term moving averages aligned in a bearish formation. EMA12 is at $64,846, below EMA26 at $65,691.3, while the current price remains well below both EMAs. MACD is at -845.39, below the signal line at -464.74, with the negative histogram expanding to -380.65, indicating that bearish momentum continues to build.

• ETH Market Update — ETH traded between $1,765.3 and $1,892.9 over the past 24 hours. Although the asset also remained weak, its decline was slightly smaller than BTC's. On the hourly timeframe, MA5 stands at $1,811.5, MA10 at $1,813.6, and MA20 at $1,842.2. ETH is currently trading below all key short-term moving averages. EMA12 is at $1,817.8, below EMA26 at $1,835.9, maintaining a bearish trend structure. MACD is at -18.10, below the signal line at -11.69, with a negative histogram of -6.41, indicating continued bearish dominance. The Bollinger Band midline is located at $1,842.2, while the lower band sits at $1,773.1. ETH is currently trading near and slightly below the lower band, suggesting the possibility of a short-term oversold rebound, though no clear bottoming signal has emerged. Multiple attempts to regain ground around $1,830 have failed, and ETH has been unable to reclaim the $1,850 level. Key resistance remains between $1,812 and $1,842. Unless this range is recovered, ETH is likely to remain in a weak consolidation phase.

• Altcoins — The overall cryptocurrency market capitalization declined by 4.4% over the past 24 hours, with major cryptocurrencies and most altcoins moving lower in tandem. The Fear & Greed Index fell to around 19, entering the Extreme Fear zone and reflecting weak market sentiment. Meanwhile, the Altcoin Season Index stood at approximately 51, suggesting that investor confidence remains limited as the market awaits a broader recovery.

• Stablecoins — Total stablecoin supply remains elevated at approximately $320 billion, indicating that on-chain U.S. dollar liquidity remains abundant. This liquidity pool continues to provide fundamental settlement depth for both spot and derivatives markets.

• Gas Fees — Ethereum mainnet gas fees increased noticeably, remaining above 1 Gwei on average. As a result, on-chain transaction and interaction costs rose significantly compared with the previous week.

Trending Tokens

Over the past 24 hours, the altcoin market broadly followed the weakness of major cryptocurrencies, with approximately 70.82% of tokens posting losses. Among the few sectors that outperformed, the AI & Big Data segment stood out, led by WLD and MAGMA. The sector recorded an average gain of approximately 0.26%, while WLD (Worldcoin) surged more than 31%. The Crypto Fear & Greed Index currently stands at 19, indicating “Extreme Fear.”

WLD (Worldcoin) (+31.81%, Circulating Market Cap: $1.793 Billion)

According to Gate market data, WLD is currently trading at $0.5221, up 31.81% over the past 24 hours. Worldcoin, founded by OpenAI CEO Sam Altman, aims to build a global identity and financial network using biometric verification technology known as Orb.

WLD's rally has been driven primarily by strength across AI-related assets and growing anticipation surrounding the World Chain mainnet. Despite the broader market correction, WLD has demonstrated exceptional resilience and capital attraction. Trading volume exceeded $930 million over the past 24 hours, suggesting significant institutional support.

MAGMA (Magma Finance) (+58.94%, Circulating Market Cap: $82.64 Million)

According to Gate market data, MAGMA is currently trading at $0.44499, up 58.94% over the past 24 hours. Magma Finance is a decentralized protocol focused on liquid staking (LST) and yield optimization, designed to improve capital efficiency across blockchain ecosystems.

The rally was fueled by the recent launch of its liquidity incentive program and a series of ecosystem partnerships. As DeFi capital continues to seek high-yield opportunities, MAGMA's attractive yield model has driven strong bottom-fishing demand. Trading volume increased substantially, while community sentiment turned notably bullish.

SUSHI (SushiSwap) (+15.26%, Circulating Market Cap: $64.32 Million)

According to Gate market data, SUSHI is currently trading at $0.2189, up approximately 15% over the past 24 hours, with an intraday high of $0.2531 and a low of $0.2009. SushiSwap is a leading decentralized exchange (DEX) protocol within the Ethereum ecosystem, offering multi-chain liquidity mining, lending, and derivatives trading. The SUSHI token also provides governance rights and revenue-sharing benefits.

SUSHI's outperformance has been largely driven by capital rotation into the DeFi sector. As broader markets declined, some investors shifted from high-risk major cryptocurrencies into DeFi blue-chip protocols with tangible revenue generation. Recent TVL data indicates a recovery in on-chain trading activity. In addition, improving regulatory clarity for DeFi and continued progress in SushiSwap's multi-chain expansion strategy have strengthened investor confidence.

Key Market Data Highlights

apxUSD Depegs to $0.94 as Bitcoin Decline Triggers Collateral Stress

According to PeckShield monitoring, Apyx Finance's stablecoin apxUSD experienced a significant depeg on June 4, falling to approximately $0.94 and recording a daily decline of 4.6%. Backed by STRC collateral, the stablecoin came under pressure as Bitcoin's sharp decline reduced the value of underlying collateral, placing strain on liquidation mechanisms and collateralization ratios.

The incident highlights a common risk associated with crypto-native stablecoins. Because their collateral is often tied to volatile assets such as Bitcoin, rapid market declines can reduce collateral value faster than liquidation systems can respond, creating systemic vulnerabilities. The event serves as another reminder that assets perceived as stable can become sources of risk during market downturns. If depegging concerns spread, broader impacts may extend to related ecosystems and lending protocols.

Bitcoin Faces Over $600 Million in Long Liquidation Risk Around $62,000

According to Coinglass liquidation heatmap data, a substantial concentration of long liquidation pressure has accumulated near the $62,000 level. Should BTC fall below this threshold, cumulative long liquidations across major exchanges could reach approximately $609 million. By comparison, a move above $66,000 would trigger only about $376 million in short liquidations.

This imbalance suggests that bulls are currently in a highly defensive position. The potential $609 million liquidation cluster represents a significant overhang for the market. If triggered, forced liquidations could accelerate downside momentum and rapidly push BTC toward the psychologically important $60,000 level. Without a meaningful bullish catalyst, the probability of a sustained recovery remains limited. Investors should closely monitor the $62,000 support zone, as a breakdown could trigger another wave of accelerated selling.

U.S. Treasury Confirms Strategic Bitcoin Reserve Is Advancing “Deliberately”; MiCA Transition Period Nears End

On June 4, U.S. Treasury Secretary Scott Bessent stated during a Senate Finance Committee hearing that the Treasury is moving forward with the Strategic Bitcoin Reserve (SBR) initiative at a “deliberate speed.” The reserve, established under an executive order signed by President Trump, is expected to be funded primarily through Bitcoin acquired via criminal and civil asset forfeitures. While acknowledging the complexity of implementation, Bessent emphasized that the government intends to adopt best practices to ensure long-term stability.

Meanwhile, the European Union's Markets in Crypto-Assets (MiCA) transition period is set to end on July 1, 2026. The European Securities and Markets Authority (ESMA) has clarified that crypto service providers operating without MiCA authorization must cease serving EU clients after the deadline, with violations potentially subject to criminal enforcement.

The Strategic Bitcoin Reserve initiative provides an important long-term fundamental support factor for BTC, although its short-term impact remains limited amid the current market downturn. Investors should pay close attention to future implementation details and potential acquisition announcements, which could become key drivers of Bitcoin's medium-term trajectory. Meanwhile, MiCA is expected to create competitive advantages for licensed exchanges while encouraging greater institutional participation in Europe's regulated crypto market, supporting the industry's long-term development.

Focus of the Week

ETF funds continue to flow out, and institutional risk appetite remains relatively cautious

From the perspective of ETF fund flows, crypto ETFs as a whole have shown a state of continuous net outflows over the past 30 days. As of early June, the total ETF assets under management (AUM) across the market were about $117.4 billion, of which BTC ETFs accounted for more than 88%, while ETH ETF size was about $13.77 billion. Historical data shows that net outflows over the past week were about $805 million, and cumulative net outflows over the past three months exceeded $313 million, reflecting that institutional capital has generally remained on the sidelines recently.

From the perspective of market structure, ETF assets as a proportion of total crypto market capitalization have risen to about 7.82%, among which BTC ETFs account for 8.08% and ETH ETFs 6.30%. Although long-term allocation demand still exists, the recent continuous outflows indicate that funds have limited willingness to chase the market at high levels. Against the backdrop of macro liquidity and intensified volatility in risk assets, ETF fund movements remain an important indicator for observing changes in institutional sentiment. If continuous net inflows reappear later, they are expected to provide incremental support to the market.

Long liquidations dominate the market, and leverage risk is being released rapidly

Over the past 24 hours, the cumulative liquidation amount in the crypto market reached $1.74 billion, of which long liquidations were about $1.54 billion and short liquidations were about $199 million. Long positions accounted for nearly 90% of total liquidations, showing that this round of market adjustment was mainly driven by concentrated stampeding in leveraged longs. From the historical liquidation curve, recent liquidation peaks have clearly expanded, accompanied by a rapid pullback in Bitcoin prices, and short-term market risk appetite has cooled significantly.

Historical statistics show that the crypto market has seen multiple extreme liquidation events exceeding $10 billion, with the largest single-day liquidation scale reaching $19.16 billion. Changes in macro policy, adjustments in regulatory expectations, and reversals in market sentiment often become the main triggers. This round of large-scale liquidation has released part of the excessive leverage risk and helps the market rebuild a healthier position structure. But if prices fail to stabilize quickly afterward, caution is still needed against secondary shocks brought by chain liquidations and liquidity contraction.

Derivatives positioning cools, and enthusiasm for high-leverage trading falls back significantly

Derivatives market data shows that current total open interest across the market is about $432.39 billion, of which perpetual contract open interest is about $415.92 billion. During the same period, perpetual contract trading volume was about $1.29 trillion, down significantly from the peak earlier this year. The simultaneous decline in open interest and trading volume reflects that market risk appetite is gradually cooling from the previous stage of high-leverage trading.

At the same time, volatility indicators have also fallen back significantly. Data shows that Bitcoin implied volatility is about 55.87, while Ethereum implied volatility is about 67.35, both having clearly converged from the previous high-volatility stage. Generally speaking, a decline in position size combined with falling volatility means the market is going through a process of deleveraging and sentiment repair. In the short term, if new funds cannot drive positions to expand again, the market may still be dominated by range-bound consolidation; but from a medium- to long-term perspective, after leverage risk is released, it also lays a more solid foundation for the next stage of trend.

Funding Weekly Recap

According to RootData, during the period from May 28, 2026 to June 4, 2026, a total of 13 crypto and related projects announced the completion of financing or mergers and acquisitions, covering multiple directions such as trading platforms, digital asset services, and institutional-grade trading infrastructure. Below is a brief introduction to the projects ranking near the top in financing scale this week:

Dunamu

On May 28, it disclosed the completion of a $204 million financing round, with a post-money valuation of about $10.19 billion.

Dunamu is the parent company of South Korean digital asset trading platform Upbit and also one of the most influential crypto financial groups in Asia. This financing ranked first this week, reflecting the capital market’s continued recognition of leading trading platforms and their ecosystem systems. As institutional investor participation increases and the digital asset market gradually matures, platforms with user scale, liquidity advantages, and compliance capabilities remain the key direction for capital deployment.

Coinone

On May 29, it disclosed the completion of a $106 million financing round. Investors included a certain CEX and institutions such as Korea Investment & Securities.

Coinone is one of South Korea’s major cryptocurrency trading platforms and has long served local retail and institutional investors. This round of financing shows that cooperation between traditional financial institutions and crypto-native platforms is further deepening. Against the backdrop of the gradual improvement of the regulatory framework in the Korean market, trading platforms with compliant operating capabilities and localized advantages are expected to continue attracting strategic capital attention and benefit from the growth opportunities brought by the future expansion of the digital asset market.

SignalPlus

On June 1, it completed a $50 million Series B1 financing round, with a post-money valuation of about $500 million. Investors included institutions such as HashKey Capital and BlockBooster.

SignalPlus mainly focuses on digital asset derivatives trading and institutional-grade risk management infrastructure, and is committed to providing more complete trading tools and strategy services for professional traders and institutional clients. As the scale of the crypto derivatives market continues to expand, market demand for risk management, trade execution, and quantitative infrastructure is continuously increasing. This round of financing shows that institutional capital remains optimistic about the development potential of the derivatives ecosystem and the important position of professional trading services in the future market.

Next Week to Watch

Token Unlocks

According to Tokenomist data, in the next 7 days (2026-06-05 to 2026-06-11), the market will see about $884 million in token unlocks. Overall short-term pressure has eased slightly compared with previous market concerns, but some individual projects are still worth close attention. The top 3 unlocks are as follows:

• HYPE will unlock tokens worth about $40.1 million in the next 7 days, accounting for 0.2% of circulating supply.

• HOME will unlock tokens worth about $30.11 million in the next 7 days, accounting for 19.5% of circulating supply.

• ENA will unlock tokens worth about $19.39 million in the next 7 days, accounting for 1.9% of circulating supply.

References:

• Gate, https://www.gate.com/trade/BTC_USDT
• Farside Investors, https://farside.co.uk/btc/
• Gate, https://www.gate.com/trade/ETH_USDT
• Gate, https://www.gate.com/crypto-market-data
• CoinGecko, https://www.coingecko.com/en/cryptocurrency-heatmap
• CoinGecko, https://www.coingecko.com/en/categories
• DefiLlama, https://defillama.com/stablecoins
• Etherscan, https://etherscan.io/gastracker
• Rootdata, https://www.rootdata.com/Fundraising
• Tokenomist, https://tokenomist.ai/
• Jinse, https://www.jinse2.com/lives/510619.html
• Odaily, https://www.odaily.news/zh-CN/newsflash/478761
  

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