Bitcoin fell to its lowest level in more than six weeks as jitters over the US-Iran war and outflows from US exchange-traded funds weighed on the largest cryptocurrency.
Bitcoin dropped as much as 3.3% to $72,643 on Thursday, its weakest since April 13. It was trading at around $73,445 in early morning in New York. Ether, the second-largest token, fell more than 4.6% to $1,965, its lowest in almost two months.
Source: Bloomberg
Stocks and bonds fell and oil climbed after fresh attacks in the Middle East hurt optimism for a deal to end the war, raising concerns it will fuel inflation and trigger interest-rate increases. The US carried out airstrikes on an Iranian military site and Kuwait said it was responding to hostile missile and drone threats.
US spot-Bitcoin ETFs have also seen net outflows of about $2.1 billion so far in May, the largest monthly retreat since November. Souring sentiment saw about $870 million of bullish crypto bets unwound in the past 24 hours, according to CoinGlass data.
“From what I can see this looks like a liquidation event driven by a confluence of geopolitical shock and over-leveraged long positioning,” said Rachael Lucas, an analyst at BTC Markets. “A clean break below $70,000 would likely trigger a significant and self-reinforcing wave of stop-losses and liquidations.”
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 confidence, said Sean McNulty, Asia-Pacific derivatives trading lead at FalconX.
Written by: Suvashree Ghosh @Bloomberg
The post “Bitcoin Falls to Six-Week Low Amid War Jitters, ETF Outflows” first appeared on Bloomberg