Why has Bitcoin crashed - and what the on-chain data says after CPI
Bitcoin has fallen roughly 50% from its all-time high of $126,080 set in October 2025. May CPI landed at 4.2% year-on-year on 10 June - in line with expectations - and Bitcoin's muted reaction suggests the worst-case macro scenario has passed. But the on-chain picture has not materially changed, and the FOMC on 17 June remains the next major risk event.
Key Takeaway
- Bitcoin has fallen ~50% from its October 2025 all-time high of $126,080, with a low of ~$61,500 on 6 June 2026.
- Four causes converged: a hawkish Fed, US-Iran geopolitical tensions, a record 13-day Bitcoin ETF outflow streak ($4.4bn), and Strategy's surprise BTC sale.
- May CPI landed at 4.2% YoY on 10 June - in line with consensus. Core CPI at 2.9% YoY was below the monthly forecast. Bitcoin dipped to ~$61,500 and recovered. (BLS, CNBC, June 2026.)
- Five on-chain metrics remain at historically bottom-adjacent levels: Fear and Greed (low), MVRV Z-Score (~0.41), 200-week MA (tested), daily RSI (recovering), Rainbow Chart (fire-sale zone).
- None of these signals guarantee a floor. Analyst cycle models place the probable low in October 2026.
- The FOMC meeting on 16-17 June is now the single most important near-term event. The dot plot matters more than the rate decision.
Bitcoin has fallen roughly 50% from its all-time high of $126,080 set in October 2025, touching a low of around $61,500 on 6 June 2026. Ethereum fell to near $1,500 at the trough, and Solana dropped more than 70% from its peak. The total crypto market capitalisation is down approximately $2 trillion from its high.
The event the market was most focused on - May CPI - has now passed. It landed at 4.2% year-on-year on Wednesday 10 June, exactly in line with consensus. Bitcoin's muted reaction (dip to ~$61,500, recovery to ~$62,800) suggests the worst-case macro scenario did not materialise. But the four structural forces that drove the crash have not resolved. This article explains what caused the crash, what the on-chain data currently shows, and what the FOMC on 16-17 June decides next.
-50%
BTC decline from Oct 2025 ATH of $126,080
4.2%
Actual May CPI YoY - in line (BLS, 10 June 2026)
17 Jun
FOMC meeting - now the decisive event for Bitcoin direction
CPI update: what happened and what it meansCPI RESULT - UPDATED 10 JUNE 2026
CPI RESULT - UPDATED 10 JUNE 2026
May CPI: 4.2% YoY (in line with consensus). Core CPI: 2.9% YoY, +0.2% MoM (below 0.3% forecast). Energy drove 60%+ of monthly increase. Bitcoin reaction: dipped to ~$61,500, recovered to ~$62,800-$63,000. Verdict: worst-case avoided. FOMC on 17 June is now decisive. (BLS; CNBC, 10 June 2026.)
The in-line print is the equivalent of the middle scenario playing out: no fresh catalyst to push Bitcoin lower, but no clear reason to rally sharply either. Core CPI at 2.9% YoY - below the 0.3% monthly estimate - signals that underlying price pressures are more contained than the headline 4.2% suggests. This gives the Federal Reserve cover to hold rates rather than hike at the June FOMC meeting. The dot plot on 17 June will confirm whether that cover is used.
The four forces behind the crash
The June 2026 crypto crash did not have one cause. It had a convergence of four separate pressures hitting an already over-leveraged market simultaneously.
1. Hawkish Federal Reserve
April CPI came in at 3.8% YoY - the hottest since May 2023 - removing any near-term prospect of rate cuts. May CPI at 4.2% kept the hawkish backdrop in place, though the softer core reading reduces the probability of rate hikes at the June meeting. BNP Paribas still projects three rate hikes from December 2026. (Bitget News, June 2026; crypto.news, June 2026.)
2. US-Iran geopolitical escalation
US-Iran military tensions escalated in late May 2026, sending oil prices sharply higher. Higher energy prices fed directly into inflation expectations, reinforcing the hawkish Fed narrative. Bitcoin dropped alongside broader market risk-off moves, though equities subsequently recovered while crypto continued lower. The US-Iran situation remains unresolved and continues to drive energy price volatility. (Usethebitcoin.com, June 2026; Intellectia.AI, June 2026.)
3. Record Bitcoin ETF outflow streak
US spot Bitcoin ETFs recorded 13 consecutive days of net outflows from 15 May to 3 June 2026 - the longest streak since their January 2024 launch - draining approximately $4.4 billion. BlackRock's IBIT alone shed around $3.3 billion. The streak has ended, but there has been no sustained return to positive inflows yet. Until institutional flows turn durably positive, the structural demand floor is weaker than it was in 2024-25. (Bitget News, June 2026; Investing.com, June 2026.)
4. Strategy surprise Bitcoin sale
Strategy (formerly MicroStrategy) sold 32 BTC in late May 2026 - its first known disposal in years. The financial impact was minimal, but the psychological effect was significant. Strategy subsequently reversed course and bought 1,550 BTC ($101.3M) on 8 June 2026 at $65,332 per coin - below its own average cost basis of $75,680 - confirming the accumulation model is intact. (SEC 8-K, June 2026; TechTimes, June 2026.)
Monitor Bitcoin's price and charts on IG
Access real-time BTC price data and technical analysis tools.
What the on-chain data says now
Several on-chain metrics remain at levels historically associated with cycle bottoms. They are not predictive - they have also appeared at points where prices fell further before recovering. They are best read as context, not direction.
| Metric | Reading (11 Jun) | Signal | What it means |
| Fear and Greed Index | ~12-15 / 100 | EXTREME FEAR | Comparable readings at Dec 2018 bottom, Mar 2020 COVID crash, Jun 2022 Terra-LUNA collapse. In all cases the market eventually recovered - but timing varied widely. |
| MVRV Z-Score | ~0.41 | NEAR FAIR VALUE | Market price approaching Bitcoin's realised cost basis. Historically, Z-scores near zero indicate the market is neither overheated nor in deep undervaluation. |
| 200-week moving average | ~$61,300 | TESTED AND HELD | BTC fell to ~$61,100 on 6 June and ~$61,500 on CPI day before recovering. The 200-week MA has marked long-term floors in every prior cycle. A sustained close below opens ~$54K as the next major reference. |
| Daily RSI | Recovering from 16 | RECOVERING FROM OVERSOLD | RSI hit 16 at the crash low. It has since recovered. RSI below 20 has historically preceded short-term relief bounces of 5-12% within 48-72 hours - this has played out. Does not imply trend reversal. |
| Rainbow Chart zone | Fire-sale / deep value | DEEP VALUE ZONE | BTC entered this band only once previously in recent history - during the FTX collapse in Nov 2022. As analyst Cowen noted: prices can fall further even from this zone. |
Sources: Alternative.me; AhaSignals/Glassnode; CoinStats AI; BeInCrypto/AMBCrypto. Figures approximately as of 6-11 June 2026. Not investment advice.
What to watch now: the FOMC on 16-17 June
- Wednesday-Thursday 16-17 June: FOMC meeting. Rate decision on 17 June. The dot plot - the Fed's own rate projections - is the key signal. Dovish shift (cuts signalled): bullish for BTC, potential rally toward $66K-$70K. Hawkish shift (hikes signalled): bearish, potential retest of $58K-$60K support.
- Key Bitcoin level: a sustained close above $65,000-$66,000 would begin to improve short-term market structure. The 200-day EMA around $76,000-$80,000 is the bigger level to reclaim for a trend recovery.
- ETF flow data post-FOMC: whether institutional investors add or reduce exposure in the days following the rate decision will be the clearest signal of institutional conviction.
Quick fact
Fact: An important caveat: signals are not guarantees
Every on-chain metric above has also appeared at points during past bear markets where prices continued lower before recovering. As analyst Benjamin Cowen noted of the 200-week moving average: "Unfortunately, last cycle it did not hold. We did in fact go below it. I cannot say with a clear conscience that we won't go below it." (BeInCrypto, June 2026.) The next major support level if BTC breaks below $61,300 is approximately $54,000, where the 300-week moving average and Bitcoin's realised price converge.
Why is bitcoin crashing - summed up
- Bitcoin has fallen ~50% from its October 2025 ATH of $126,080, with a low of ~$61,500 on 6 June 2026.
- May CPI: 4.2% YoY in-line on 10 June. Core CPI 2.9% YoY below forecast. Bitcoin dipped to ~$61,500, recovered to ~$62,800-$63,000.
- Four crash causes: hawkish Fed, US-Iran tensions, record $4.4bn ETF outflow streak (now ended), Strategy surprise BTC sale (subsequently reversed).
- Five on-chain metrics at historically bottom-adjacent levels - none guarantee a floor. Analyst models place probable cycle low in October 2026.
- FOMC 16-17 June is now the decisive event. Dot plot signals matter more than rate decision.
- Cryptoassets are highly volatile. You could lose all the money you invest.
Getting started with IG
Open a free account in minutes, with no monthly fees and zero commission on Bitcoin, Ethereum and Solana.
Step 1
Create your account - Open a free IG account online or via the app - takes under five minutes.
Step 2
Fund your account - Deposit from £100 with a debit card, bank transfer, or PayPal.
Step 3
Buy crypto - Search for Bitcoin, Ethereum or Solana, set your amount, and confirm.
Open a free account
Zero commission on BTC, ETH and SOL
Frequently asked questions
Why is Bitcoin dropping?
Bitcoin has fallen approximately 50% from its October 2025 all-time high of $126,080 due to a convergence of four factors: a hawkish Federal Reserve following hot CPI readings (April at 3.8%, May at 4.2%), US-Iran geopolitical tensions driving energy and inflation expectations higher, a record 13-day streak of Bitcoin ETF outflows totalling ~$4.4 billion, and sentiment shock from Strategy's first Bitcoin sale since 2022 (subsequently reversed). As of 11 June, BTC is trading around $62,800-$63,000 after an in-line CPI print on 10 June triggered a muted dip-and-recovery reaction.
Is the Bitcoin bull market over for 2026?
Whether the bull market is over is genuinely uncertain. The May CPI in-line print avoided the worst-case scenario, but the Federal Reserve's FOMC dot plot on 17 June remains the key risk event. Long-term on-chain fundamentals (MVRV near fair value, 200-week MA held) remain constructive, but analyst cycle models suggest the probable cycle low may not arrive until October 2026. This article does not provide personalised investment advice.
What did May CPI come in at and how did Bitcoin react?
US May CPI printed at 4.2% year-on-year on Wednesday 10 June 2026 - exactly in line with the consensus forecast. Core CPI came in at 2.9% YoY and 0.2% MoM, below the 0.3% estimate. Energy accounted for 60%+ of the monthly increase. Bitcoin dipped to approximately $61,500 on the release before recovering to ~$62,800-$63,000 by 11 June - a muted reaction consistent with the in-line scenario, where no fresh catalyst was provided to either direction.
What is the MVRV Z-Score and why does it matter?
The Market Value to Realised Value (MVRV) Z-Score measures how far Bitcoin's current market price deviates from its realised price - the aggregate average price at which all Bitcoin last changed hands on-chain. A Z-Score near zero means the market is trading close to its long-term cost basis rather than at a speculative premium. A reading of approximately 0.41 (AhaSignals, June 2026) puts Bitcoin in near fair value territory, a zone that has historically preceded accumulation phases. This is not a guaranteed buy signal - prices have fallen further from similar readings in past cycles.
What is the 200-week moving average for Bitcoin?
The 200-week moving average is the average of Bitcoin's weekly closing price over the past 200 weeks - approximately four years. Bitcoin's 200-week MA is currently near $61,300. BTC tested this level twice in early June 2026 - touching an intraday low of approximately $61,100 on 6 June and ~$61,500 on CPI day (10 June) - before recovering both times. In previous cycles, sustained breaks below the 200-week MA have been rare and short-lived, but analyst Benjamin Cowen has noted it is not impossible. (BeInCrypto, June 2026.)
Trade and invest in crypto with IG
Important to know
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Past performance is not a reliable indicator of future results.
Follow us online
