Bitcoin prices fell below the “fire sale” level on Thursday. On the Bitcoin Rainbow Chart, the Fear and Greed Index scores 12 out of 100, a depth band not reached since the catastrophic FTX exchange collapse in November 2022, moving deep into “extreme fear” territory.
Bitcoin price started today around $63,500 after falling below $62,000 last night. it is $BTC It is below even the most discounted valuation band on the Bitcoin rainbow chart, a level that the model has historically flagged as a rare and extreme buy signal.
Bitcoin’s rainbow chart is like a logarithmic growth curve overlaid with color-coded sentiment bands. Deepest band — labeled “Basically a fire sale!” — Represents the low end of the model’s predicted fair value range. When Bitcoin trades below it, the asset is outside of its previous channel. $BTClong-term price trends.
Just in: Bitcoin falls below “fire sale” territory for the second time in four years
buy dip
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— Bitcoin Magazine (@BitcoinMagazine) June 4, 2026
Last confirmed “fire sale” violation! This floor occurred during the collapse of the FTX exchange in November 2022, when Sam Bankman Fried’s crypto empire collapsed. $BTC Cratered by forced selling pressure across the market. This event remains one of the most severe liquidity crises in the history of cryptocurrencies.
Hit Bitcoin Magazine Pro According to data from March 2026, Bitcoin price had already started testing below the “fire sale”. Zone — described at the time as “the first dip into this area since the FTX crash.”
A new descent on June 4th further deepened that breakthrough, making it the coin’s spot for the second week in a row.
Bitcoin price and market in “extreme fear”
The Fear and Greed Index, which runs on a scale of 0 to 100, hit 12 on Thursday, placing the market squarely in the “extreme fear” category. The index aggregates volatility, market momentum, social sentiment, and derivatives data into a single score.
A reading below 25 indicates extreme fear, which has historically preceded a period of price recovery, according to the index’s own framework.
February 2026 saw a 52% drawdown from the Bitcoin price peak of $126,000, and the index reached an all-time low of 5. Thursday’s value of 12 sits just above its nadir as Bitcoin prices continue to fall from cycle highs.
Today on X, Strategy’s Michael Saylor argued that this decline reflects institutional capital being rotated into AI infrastructure, rather than a deterioration in Bitcoin’s fundamentals. Concerns about strategic sales may have exacerbated the decline32 $BTC This was despite the company recently reducing its debt by buying back $1.5 billion in convertible debt at a discount to fund its preferred stock dividend (its first Bitcoin sale since 2022).
The post Bitcoin Price Drops Below ‘Fire Sale’ Territory as Fear Index Reads 12 — Reverberations of the FTX Crash appeared first on Bitcoin Magazine and written by Micah Zimmerman.
