Half of Bitcoin Supply Underwater as CME Lists Volatility Futures, ETF Outflows Top $5B

Bitcoin News

On-chain data shows that 51.6% of the circulating Bitcoin supply now sits below its cost basis, up sharply from roughly 34% a month earlier. That reading effectively splits the network in two, with profitable and underwater coins now near parity. The metric tracks the last price at which each coin moved on-chain, so it directly captures how many holders face unrealized losses. Such an elevated share of circulating supply at a loss is historically rare; comparable readings appeared near the 2015 lows, the 2018 sell-off and after the late-2022 exchange collapse, periods often clustered around major bear market bottoms.

Institutional derivatives infrastructure expanded as CME Group launched Bitcoin volatility index futures last week, with DV Chain and Monarq Asset Management executing the first block trades. The contracts track the CME CF Bitcoin Volatility Index, which reflects expected price swings over a forward four-week window. Unlike standard futures, perpetuals and options, the new product lets traders take a view purely on the magnitude of movement rather than direction, enabling fresh hedging strategies around events such as US inflation prints. CME's crypto derivatives volume reached roughly 266,900 contracts year-to-date, a 38% annual increase, while average daily open interest climbed about 18% to near 274,500 contracts.

Grayscale research director Zach Pandl argued that Bitcoin has returned to undervalued territory based on a composite on-chain valuation gauge weighing unrealized profit and loss against long-term coin-days-destroyed metrics. Prices are not as deeply discounted as during the FTX-era washout, he noted, pointing instead to cautious optimism rather than a confirmed floor. Pandl attributed the potentially shallower drawdown to a more restrained prior bull run and a maturing market structure shaped by spot ETF adoption. He flagged two near-term swing factors: progress on the US CLARITY Act and the resilience of leveraged holders, and suggested gradual accumulation over single large entries.

Bitcoin posted its sharpest weekly loss since the November 2022 collapse, sliding roughly 16% over seven days and breaking below the $60,000 threshold, leaving it more than 50% beneath its $126,000-plus record. Selling accelerated on June 9 after US Central Command announced self-defense strikes against Iran, sending BTC down about 3% to $61,766. The escalation followed the downing of a US Apache helicopter near the Strait of Hormuz. Roughly $136 million in long positions were liquidated across the market in 24 hours, the bulk in Bitcoin, while Strategy trimmed a small slice of reserves even as it added about 1,550 BTC.

Bitcoin also slipped back toward miners' average production cost, estimated near $62,650 per coin, a level Capriole Investments founder Charles Edwards described as one of the strongest long-term value zones in past cycles. He framed the $62,650 to roughly $50,000 band, the latter approximating electricity-only costs, as a historically notable accumulation region. The pressure is visible in network fundamentals: hashrate has fallen from levels near 1,000 EH/s in May to around 837 EH/s, a drop of roughly 19%. That decline suggests some less efficient miners have powered down rigs amid thinning margins, a pattern that has previously coincided with value-zone conditions.

Spot Bitcoin ETF products continued to bleed capital, recording more than $5 billion in net outflows over the past four weeks. The combined net assets of 11 US spot funds fell to $77.58 billion on June 9, matching levels last seen just after the November 2024 election. Holdings had peaked at a record $169.54 billion in October 2025 before surrendering most of those post-election gains, even as the regulatory backdrop improved. Analysts tied the persistent redemptions to high inflation keeping the Federal Reserve restrictive, geopolitical uncertainty and competing growth themes, including the artificial-intelligence trade, drawing capital away from crypto exchange-traded vehicles.

COINOTAG's proprietary 42-indicator composite scoring engine rates the $61,811 resistance at 80/100, the strongest overhead level, driven by the confluence of the prior-day close, Fibo 0.114 and R1, with $64,207 scored 73/100 from POC and R2. On the downside, the engine marks $58,772 support at 75/100 (ATR Lower, Donchian Lower, Swing Low) and $60,715 at 71/100 (S1, RSI oversold). Derivatives show a near-flat 0.0004% funding rate and $11.5 billion open interest, yet a 2.23 long/short ratio (69% long) signals crowded longs vulnerable to flushes. With RSI at 23.4 and a 9/100 Extreme Fear print, a bullish reclaim of $61,811 is needed; losing $58,772 invalidates the basing thesis toward $52,679.