Have institutions started dumping Bitcoin…Is a $70,000 collapse coming?

▲ Bitcoin (BTC) Exchange Traded Fund (ETF) ©CoinReaders

Warning lights have been triggered again in the Bitcoin (BTC) market. As the longest-ever outflow of funds from US spot Bitcoin ETFs continues, institutional demand is rapidly cooling, and coupled with the breakdown of key support levels, the overall downward pressure on the market is intensifying.

According to cryptocurrency market data aggregator CoinMarketCap on June 1 (local time), Bitcoin traded at $73,509, down 0.72% over a 24-hour period. While the overall cryptocurrency market showed a flat trend, Bitcoin exhibited a relatively weaker performance. The recent large-scale outflow of funds from US spot Bitcoin ETFs is being cited as the biggest reason for the decline.

According to the media, US spot Bitcoin ETFs have seen net outflows for 9 consecutive trading days, with a total of $2.84 billion flowing out. This marks the longest streak of net outflows since the ETF's launch. In particular, a sell-off of $1.26 billion from BlackRock's iShares Bitcoin Trust (IBIT) alone suggests that institutional investors' risk aversion sentiment has strengthened. The market is assessing that the institutional capital flow that has driven Bitcoin's rise has notably slowed down.

Technical trends have also deteriorated. Bitcoin has fallen below the $75,000-$76,000 range, which was considered a key support area, confirming a sustained bearish pattern. Simultaneously, approximately $10.04 million worth of Bitcoin liquidations occurred within 24 hours, with long position liquidations outweighing short positions. Analysts suggest that some leveraged long positions were forcibly liquidated during the decline, increasing additional selling pressure.

The short-term market direction is dependent on ETF fund flows and whether the $70,000-$72,000 support range can be defended. If Bitcoin holds above $72,000 and the net outflow from ETFs eases, a recovery attempt towards $75,000 is possible. Conversely, if the $70,000 support level also breaks, further correction to the $65,000-$66,000 range is also being discussed.

Market experts diagnose that the current Bitcoin structure remains defensive below $75,000. In particular, as the Bank of Japan (BOJ) policy statement scheduled for June 3 could affect global liquidity flows, caution is needed regarding the potential for increased short-term market volatility.

*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*