Bitcoin at risk of $60,000 as Zcash plunges after Orchard privacy bug
Bitcoin is trading just above $62,000 and has fallen about 16% from last week’s $74,000+ levels as the “AI trade” unwinds. A breakdown of $60,000 would likely drag BTC into the zone last seen during February’s drawdown, with the next technical support around $55,000.
Market pressure is also visible in U.S. spot Bitcoin ETFs, which have recorded 15 straight sessions of net outflows totaling more than $4.7 billion. Strategy disclosed its first Bitcoin sale since 2022, and the firm is no longer acting as the marginal corporate buyer that previously absorbed selling through 2024–2025.
On the altcoin side, Zcash (ZEC) is down roughly 37% in one of its worst one-day declines after Shielded Labs disclosed a critical bug in Zcash’s Orchard privacy pool. The vulnerability, present since Orchard’s May 2022 activation, could have enabled unlimited, undetectable counterfeit tokens. Shielded Labs says it cannot confirm whether the flaw was exploited before an emergency patch on June 1, and it is proposing a network upgrade with new accounting measures and expanded security efforts to restore confidence in ZEC supply integrity.
Taken together, the BTC setup and the risk-off tone from ZEC’s supply-integrity concerns increase downside sensitivity across crypto—especially if ETF outflows persist while BTC loses the $60,000 level.
Bearish
This news is net bearish for traders because it combines BTC technical weakness with continued ETF-driven selling pressure, while ZEC’s supply-integrity scare adds broader “risk-off” sentiment.
Short-term: The $60,000 level is framed as the next obvious test. With BTC already down ~16% and ETF outflows continuing for 15 straight sessions (> $4.7B), momentum traders typically treat the break of a major round number as a trigger for further selling/stop-outs. Strategy’s first BTC sale since 2022 can further reinforce the narrative that marginal demand is weakening.
Cross-crypto spillover: ZEC’s 37%+ drop follows a “critical privacy pool bug” disclosure and uncertainty about pre-fix exploitation. Similar past crypto security shocks (where supply/validity questions emerged) often cause traders to reduce exposure broadly, rotate to cash, and widen risk premiums across the sector.
Long-term: If Shielded Labs’ proposed Zcash network upgrade restores confidence, ZEC could stabilize after the initial panic. For Bitcoin, the longer-term tone hinges on whether ETF flows reverse and whether BTC can reclaim/hold key supports (next cited area around $55,000). Until then, the setup favors downside volatility rather than sustained upside.
Overall, the combination of potential BTC breakdown risk and negative ETF flow dynamics outweighs any near-term positive catalysts.