Bitcoin falls to 5-week low amid war jitters, ETF outflows
Synopsis
Bitcoin has seen its sharpest fall in over five weeks. Concerns about the global economic outlook and money leaving US Bitcoin exchange-traded funds are impacting the cryptocurrency. Investors are cautious due to geopolitical tensions and rising interest rate fears. This has led to a dip in Bitcoin’s price, with analysts expecting further downside risks.
Bitcoin fell to its lowest level in more than five weeks as jitters over the economic outlook and outflows from US exchange-traded funds weighed on the largest cryptocurrency.
Bitcoin dropped as much as 1.5% to $74,017 in Singapore Thursday, its weakest since April 20, while second-largest token Ether fell more than 2%.
Concerns that the ongoing US-Iran war will fuel inflation and trigger interest-rate increases are unnerving investors even as stocks have soared to record highs on optimism about artificial intelligence. US spot-Bitcoin ETFs have seen net outflows of about $1.5 billion so far in May.
Crypto TrackerTOP COINS (₹) Tether96 (0.66%)BNB61,339 (-1.91%)Bitcoin7,045,065 (-2.56%)XRP123 (-3.03%)Ethereum190,665 (-3.63%)
Bitcoin’s weakness “looks mostly macro-driven, not crypto-specific,” said Sean McNulty, Asia-Pacific derivatives trading lead at FalconX. Higher US yields and a firmer dollar have tightened financial conditions, while ETF withdrawals and reports of a large block sale of the iShares Bitcoin Trust — the largest Bitcoin ETF — also dented sentiment, he said.
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IG Markets analyst Tony Sycamore said crypto traders are taking a more cautious stance as they wait for concrete progress out of the Middle East.
“Furthermore, with equity markets starting to look a little tired, Bitcoin is feeling the pinch as leveraged long positions get trimmed on the break of key support levels in the mid $70,000’s,” Sycamore said, adding near-term risks are tilted toward the downside.
