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Bitcoin (BTC) fell toward $66,000 on Wednesday as investors rushed to hedge downside risk, pushing the market’s primary fear gauge to its largest daily jump since February 2026. The decline came amid nearly $4 billion in spot Bitcoin exchange-traded fund (ETF) outflows since mid-May, heavy long liquidations, whale selling, and growing competition for investor capital from record-breaking equity markets.
The move also prompted renewed criticism from gold advocate Peter Schiff, who argued that a break below $50,000 could trigger a much deeper collapse. While traders remain focused on key support levels near $65,000, the sudden return of fear marks a sharp shift from the relatively calm sentiment that dominated Bitcoin’s previous decline to $75,000 from $82,000.
Bitcoin briefly traded below $66,000 after falling more than 6% in a single day, extending a correction that began after the asset lost support near $70,000. The decline pushed BTC to its lowest level since early spring and left the asset down more than 12% from levels seen only a week earlier.
The latest move stands out because market sentiment remained relatively calm during Bitcoin’s earlier decline to $75,000 from $82,000. This time, traders responded differently.
BVIV, a volatility index that tracks expected 30-day Bitcoin volatility, surged nearly 20% in one day. According to TradingView, that marked the largest daily increase since Feb. 5, 2026, when Bitcoin experienced a much sharper panic-driven selloff toward $60,000.
Unlike traditional price charts, BVIV measures how aggressively traders are buying options protection. Rising volatility expectations often indicate investors expect larger price swings ahead.
The sharp jump in BVIV suggests traders are no longer treating the decline as a routine pullback.
Several bearish developments arrived within a short period. Strategy disclosed its first Bitcoin sale since December 2022. Mt. Gox transferred more than 10,000 BTC to new wallets as creditor repayment concerns resurfaced. Spot Bitcoin ETFs continued bleeding capital. At the same time, oil prices moved higher amid geopolitical tensions, increasing pressure on risk assets.
Those developments coincided with aggressive selling across crypto markets, particularly among leveraged traders.
CoinGlass data showed more than $1.8 billion in liquidations over 24 hours, with long positions accounting for $1.66 billion of that total. Forced liquidations often accelerate declines because leveraged traders are pushed out of positions regardless of price.
Santiment data also pointed to distribution from larger holders. Wallets holding between 10 and 10,000 BTC reduced holdings by more than 24,000 coins during the past week, while smaller holders continued accumulating.
📊 The descent of crypto prices, particularly Bitcoin’s -13% drop in the past week, can be attributed primarily to the dumping by key stakeholders:
🐳🦈 Bitcoin whales and sharks (holding 10-10K $BTC) have dumped -24,602 coins (-18%) in the past week.
🐟🦐 Bitcoin micro traders… pic.twitter.com/XYS77ZucUm
— Santiment Intelligence (@SantimentData) June 3, 2026
Institutional demand remains one of the clearest headwinds facing Bitcoin.
According to SoSoValue data, US spot Bitcoin ETFs recorded more than $519 million in net outflows on Tuesday, extending a negative streak that has lasted nearly two weeks. Total outflows since mid-May have approached $4 billion.
ETF flows have become one of the market’s most closely watched indicators because they provide a direct measure of institutional participation. During Bitcoin’s rally in 2024 and 2025, sustained ETF inflows frequently supported higher prices. The current trend points in the opposite direction.
Bitcoin and crypto assets are also facing growing competition for investor capital as AI-linked equities and major stock indexes continue pushing to record highs.
K33 Research recently pointed to growing competition from AI-linked equities, saying many investors view the opportunity cost of holding Bitcoin as increasingly difficult to justify while technology stocks continue posting outsized gains.
Over the past 12 months, the AI boom has added $19 trillion of new marketcap to the top 50 public equities, that’s 13x bitcoin’s total market cap. This historic capex cycle is vacuuming up all liquidity and attention, so it’s astonishing that BTC/USD is this resilient!
— Pierre Rochard (@BitcoinPierre) June 2, 2026
Against that backdrop, Peter Schiff used the selloff to repeat his long-standing bearish view on Bitcoin.
The Euro Pacific Capital chief said there was still too much complacency in the market for Bitcoin to have reached a bottom. Schiff argued that a break below $50,000 could trigger a rapid decline beneath $20,000 and force long-term holders to abandon their positions.
There is way too much complacency in Bitcoin for the market to be anywhere near a bottom. When Bitcoin breaks $50K, it should be a quick fall below $20K, which should be a big enough drop to shake the conviction of long-term HODLers, causing many to finally throw in the towel.
— Peter Schiff (@PeterSchiff) June 2, 2026
Schiff’s comments arrived as Bitcoin traded near its lowest level in months and ETF outflows continued extending their losing streak.
The prediction also received substantial pushback. Many Bitcoin supporters noted that Schiff has maintained bearish views throughout multiple market cycles, including periods when Bitcoin traded below $1,000. Others argued that Bitcoin’s utility as a decentralized monetary network remains separate from short-term price fluctuations.
From a market perspective, traders appear more focused on near-term support levels than Schiff’s long-term target.
Several market participants continue monitoring the $65,000 area as Bitcoin’s most important short-term support.
Trading company QCP Capital said it sees initial support between $63,000 and $64,000, while BTIG chief market technician Jonathan Krinsky said Bitcoin needs to hold around $65,000 to avoid a deeper test toward $60,000.
Not all market signals point in the same direction.
While fear has returned, volatility remains far below February 2026 panic levels when BVIV briefly exceeded 90%. Bitcoin also continues trading above support levels that attracted buyers earlier this year. Retail wallets have accumulated during the decline, suggesting not all market participants view the selloff as the start of a prolonged bear market.
For now, traders appear focused on whether Bitcoin can stabilize above $65,000 after ETF outflows, whale distribution, and liquidation pressure pushed the asset toward its weakest levels in months. The next major support zone identified by trading desks sits between $60,000 and $64,000, placing that range at the center of the market’s attention as ETF outflows and volatility continue climbing.
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