Bitcoin has lost more than 50% since its October 2025 peak above $120,000, falling below $60,000 by June 2026. BlackRock attributes the correction to a massive unwind of leverage, with open interest reaching $90 billion, 80% in perpetual futures traded outside the CME, rather than a deterioration of its core investment thesis. Spot Bitcoin ETFs recorded $60 billion in inflows before experiencing $5 billion in net outflows, while AI-themed funds attracted over $46 billion. Despite this speculative purge, the asset manager maintains its recommendation of a 1-2% allocation to bitcoin as a diversification tool and hedge against the erosion of fiat currency purchasing power.
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