Bitcoin fell to $57,742 during Asian trading on Tuesday, its weakest level in 21 months, before paring losses to hover near $58,800. The decline extends a rout that has erased more than 50% of the token’s value since it reached an all-time high of $126,223 in October 2025. Ether, the second-largest digital asset, dropped to $1,570, a level last seen in April 2025, as the broader crypto market tracked the sell-off.

Behind the slide is a sharp reversal in institutional demand. Investors pulled over $4 billion from US spot bitcoin exchange-traded funds in June alone, marking the heaviest monthly outflow since the products launched, according to Bloomberg data. Citi analysts, in a note slashing their 12-month bitcoin target to $82,000 from $112,000, pointed to eight consecutive weeks of negative ETF flows and cut their net inflow assumption for the coming year to zero. The Federal Reserve’s decision in June to hold rates at 3.5–3.75% and its subsequent hawkish rhetoric have strengthened the dollar and drained appetite for non-yielding assets, with traders now pricing a higher probability of a rate increase.

Additional pressure stems from Strategy, the largest corporate holder of bitcoin. The firm’s announcement of a potential $1.25 billion bitcoin sale to bolster cash reserves, alongside two $1 billion buyback programmes, has unsettled investors who had viewed the company as a reliable source of demand. Analysts in Moscow and New York note that the shift in Strategy’s balance-sheet priorities has amplified fears of reduced structural buying support. Geopolitical uncertainty surrounding US-Iran tensions has further encouraged a rotation away from risk assets, with capital flowing into AI-linked equities instead.

Market attention now turns to the upcoming US employment report. A strong labour-market print would reinforce the case for tighter monetary policy, potentially extending the crypto downturn. Citi’s bear-case scenario, which assumes recessionary conditions and persistent ETF outflows, values bitcoin at $53,000 and ether at $1,094 over the next 12 months.