Bitcoin experienced a dramatic crash on May 28, falling to $72,728 - its lowest level since mid-April - as escalating US-Iran tensions triggered massive market selloffs. According to latest reports, the cryptocurrency has since recovered to approximately $73,200 but remains under significant pressure. The decline came after over $930 million in crypto positions were liquidated in a single day, affecting approximately 165,000 to 167,000 traders. The crisis began when the US struck Iranian drones and targets near the Strait of Hormuz overnight on May 28, prompting Iran to respond by attacking a US base in Kuwait. This escalation threatened the recent ceasefire and potential deal between the countries, forcing investors to mass-exit risk assets.
US spot Bitcoin ETFs witnessed considerable outflows, with total withdrawals exceeding $2.5 billion over the past two weeks. As reported by The Economic Times, Subburaj from CoinDCX Research Team noted that the 11 US-listed spot Bitcoin ETFs alone saw roughly $1.26 billion in outflows last week after nearly $1 billion in withdrawals during the previous week. This represents a significant shift in institutional and retail investor sentiment toward cryptocurrency exposure. The latest data shows that BTC ($363M) and Ethereum ($240M) were the hardest hit in the recent liquidation wave, with the largest single liquidation being a $15.34 million BTC long position on the Hyperliquid platform.
The decline extended across the cryptocurrency ecosystem, with Bitcoin losing 3.5% over the past 24 hours and down 6% for the week. According to latest reports, Ethereum fell 4.44% over the past 24 hours to trade near the $1,977 mark. Among major altcoins, BNB, XRP, Solana, Tron, Dogecoin, Hyperliquid and Cardano declined by up to 4.58%. In the past week, Bitcoin and Ethereum were down 6.48% and 7.82% respectively, while BNB, XRP, Solana, Dogecoin and Cardano corrected 8.37%, though Tron and Hyperliquid showed resilience with gains of 1.52% and 2.75% respectively. The long positions accounted for 93% of liquidations, highlighting the immediate market response to geopolitical uncertainties.
The cryptocurrency market continues to face significant upward pressure as the fear and greed index has further dropped to 34, with sentiments remaining in fear territory. As reported by The Economic Times, CoinDCX Research Team noted that Bitcoin continues to face pressure as the price slashes below $74,000. Fund manager Michael Kramer warns that bitcoin could continue falling due to upcoming US Treasury operations from May 28 to June 5, which will remove approximately $150 billion in liquidity from the system through T-bill and coupon settlements. Kramer noted that "Bitcoin is an excellent liquidity indicator. With such an outflow of cash, it could go significantly lower" as the cryptocurrency has already broken through important support at $75K and shows weakness amid a strong dollar and rising Treasury yields.
