So what typically happens to a wire spoked wheel, is because the bottom spokes some lose tension under load due to the local inwards deformation, there is a maximum load where they lose all tension and they will immediately buckle if the load exceeds the maximum. When this happens, the wheel has lost all capability to resist further load and the rim at the bottom will deform inwards, in effect dropping the axle downwards (same as crushing your wooden disc wheel). Deform far enough and the rim suffers permanent deformation or under very severe conditions, it will completely collapse inwards at the bottom.
All well put and I'd just like to highlight that perhaps some of the confusion is that at this point the hub
will hang from the top because there's no longer any support from the bottom! But just like pulling a chair out from under someone will make them fall, this has no bearing on how things are when the support is there.