Bitcoin (BTC) Faces Critical Juncture Amid Market Volatility

Bitcoin experiences a significant price correction amidst strong spot demand and macroeconomic risks, with over $1.9 billion liquidated in a week, according to Bitfinex Alpha.

Bitcoin (BTC) experienced a significant price correction this week as strong spot demand and macroeconomic risks drove a textbook crypto rally, according to a recent report by Bitfinex Alpha.

The cryptocurrency experienced a 10% decline from its all-time high (ATH), encountering a downturn that peaked on June 5 with over $875 million in long positions liquidated in a single day.

This incident highlights the aggressive nature of the market's current process, having seen over $1.9 billion liquidated in the past week alone.

The technical structure of the market indicates that BTC's rally was largely supported by real demand, evident in the series of spot-led price increments and the formation of crucial accumulation zones, notably between $93,000–96,000 and $102,000–104,000.

On-chain indicators currently suggest increased selling pressure as long-term investors begin distributing their holdings. The Spent Supply Distribution (SSD) index and the Short-Term Holder Cost Bands (STH) provide a clear roadmap for support levels.

An SSD level of 0.95 at $103,700 marks the initial support zone, followed by $97,100 (STH Cost) and $95,600 (SSD 0.85), with $83,200 identified as a critical risk level. These levels are pivotal as they represent the cost bases of major investors and recent buyers, serving as potential re-entry points or liquidation triggers.

In the broader U.S. macroeconomic landscape, May's job growth data revealed some vulnerabilities. While the headline figures showed an addition of 180,000 jobs, this represents a slowdown from the prior month and signals initial pressures from trade tensions and tariff uncertainties.

Although average hourly earnings rose steadily by 0.3%, remaining within expectations at 4.4% year-over-year, the shrinking labor force and downward revisions to past employment data suggest a weakening labor market.

Furthermore, both the ISM Manufacturing and Services PMI scores slid deeper into contraction territory in May due to rising input costs and declining demand, highlighting the widespread impact of tariffs on the U.S. economy.

On a positive note, the U.S. trade deficit narrowed significantly in April as imports declined sharply, particularly from China, due to weakened demand and inventory buildups during the prior period. However, this decline in imports is a point of concern as it could lead to future shortages and drive up inflation.

Investor interest in U.S. long-term bonds appeared to be waning, according to auction data and futures markets, which also indicated some skepticism towards financial stability.

In other developments, cryptocurrency adoption continued to accelerate across various sectors. IG Group, a well-known British trading platform, secured approval to become the first listed company in the UK to offer spot cryptocurrency trading for retail investors, in partnership with Uphold.

This move marks a significant shift from the previously available speculative derivative products to actual asset ownership.

This development also comes as the UK Financial Conduct Authority (FCA) proposed lifting its ban on crypto exchange-traded notes (cETNs) for retail investors, signaling broader regulatory support for digital assets.

Additionally, Metaplanet, a Japanese company, announced plans to raise ¥850 billion ($5.4 billion) in equity to massively expand its Bitcoin portfolio, aiming to hold 210,000 BTC by 2027. This initiative highlights Asia's expanding role in institutional cryptocurrency adoption.