Bitcoin Falls to Five-Week Low Amid ETF Withdrawals and Global Market Uncertainty

Bitcoin Plunges to Five-Week Low Amid Economic Jitters and ETF Outflows

Bitcoin, the largest cryptocurrency, experienced a significant drop on Thursday, reaching its lowest level in over five weeks. The price of Bitcoin fell as much as 1.5% to $74,017 in Singapore, its weakest point since April 20. Notably, second-largest token Ether also declined by more than 2%.

The ongoing US-Iran war has heightened concerns over inflation and potential interest-rate increases, causing investors to become increasingly nervous. Despite stocks reaching record highs due to optimism around artificial intelligence, the economic uncertainty is weighing heavily on the cryptocurrency market. In fact, US spot-Bitcoin ETFs have seen a net outflow of approximately $1.5 billion in May so far.

According to analysts, Bitcoin's weakness is largely driven by macroeconomic factors rather than specific issues within the cryptocurrency market. Higher US yields and a stronger dollar have tightened financial conditions, while ETF withdrawals and reports of a large block sale of the iShares Bitcoin Trust, the largest Bitcoin ETF, have contributed to a decline in sentiment.

Read also: Bitcoin Price Sinks 6% Below $66,500 Amid ETF Outflows and Institutional Selling

Market analysts have attributed the cautious stance of crypto traders to the ongoing Middle East tensions and the need for concrete progress in the region. Additionally, as equity markets appear to be showing signs of fatigue, Bitcoin is feeling the pressure as leveraged long positions are trimmed on the break of key support levels in the mid $70,000 range.