Bitcoin slides to six-week low amid ETF outflows, Iran tensions

Bitcoin fell to its lowest level in more than six weeks on Thursday (May 28) as investor sentiment weakened amid escalating geopolitical tensions in the West Asia and continued outflows from US spot Bitcoin exchange-traded funds (ETFs).

The world’s largest cryptocurrency dropped as much as 3.3% to $72,643 in Singapore trading, its weakest level since April 13. Ether, the second-largest cryptocurrency, declined more than 4% to $1,965, marking its lowest level in nearly two months.

According to Akshat Siddhant, lead quant analyst at Mudrex, the latest selloff followed US airstrikes on Iran, which triggered broad risk aversion across global markets.

“Bitcoin came under fresh selling pressure following the U.S. airstrikes on Iran, triggering nearly $1 billion in liquidations across the crypto market,” Siddhant said. He added that Bitcoin ETFs have recorded outflows for eight consecutive sessions, with more than $2 billion withdrawn during the period.

Siddhant also said the lack of progress on key US crypto legislation, including the Digital Asset PARITY Act and the CLARITY Act, has kept investors cautious.

“Currently trading at $72,800, BTC must defend the $70,000 level to avoid further downside. A sustained move above $75,000 could help stabilise the price in the short term,” he said.

Separately, Vikram Subburaj, CEO of Giottus.com, said Bitcoin remains in a “macro-driven consolidation zone” near the $74,000-$75,000 range as volatility across global markets rises.

Subburaj noted that institutional flows remain under pressure, with US-listed spot Bitcoin ETFs witnessing heavy withdrawals over recent weeks. According to analysts cited by Giottus.com, the 11 US-listed spot Bitcoin ETFs saw roughly $1.26 billion in outflows last week, after nearly $1 billion in withdrawals during the previous week, taking cumulative two-week outflows to about $2.54 billion.

“The ETF trade had become the market’s cleanest liquidity engine after the 2024 approvals. That engine is now slowing,” Subburaj said.

He added that Bitcoin’s inability to reclaim the $78,000-$80,000 range over multiple sessions has become “structurally important” for the market, especially as the cryptocurrency now trades below key on-chain cost-basis levels tracked by market analysts.

Subburaj also pointed to broader macroeconomic pressures, including elevated US bond yields, a stronger dollar and rising oil prices, as factors weighing on risk assets such as cryptocurrencies.