Bitcoin trended lower on Wednesday, falling below the $75,000 threshold and trading at $74,570 at the time of writing. The decline wiped out nearly 3% of its weekly value and pushed its market capitalization below $1.5 trillion.
Important points:
- Bitcoin fell below $75,000 on May 27 as Glassnode warned of a drop in inflows to exchange-traded funds (ETFs).
- According to Bitstamp data, BTC is down 3% for the week, with $115.3 million in leveraged longs wiped out.
- Polymarket traders put the probability of a deal between the US and Iran at 30% ahead of the May 31 deadline.
On-chain metrics show fading momentum
Bitcoin has trended lower for the second day in a row, falling below the $75,000 threshold, even as Wall Street’s major indexes remain near all-time highs. The leading cryptocurrency spent most of the past 24-hour trading session above $75,500 before plummeting to its lowest price of the day, according to Bitstamp data.
The steepest decline began around 8:44 a.m. ET, with the digital asset falling from $76,800 to $74,637 in just under two hours. Bitcoin briefly recovered to just over $75,300 an hour later, but eventually lost momentum and retreated to an intraday low of $74,530. The latest decline pushed Bitcoin’s market capitalization below the $1.5 trillion level for the second time this month, widening its weekly loss to nearly 3%.
Bitcoin’s short-term weakness closely aligns with the fundamental changes highlighted in Glassnode’s weekly on-chain report. Data shows that Bitcoin’s broad upward momentum has stalled behind the scenes, stalled by weakening spot demand and a sharp deterioration in U.S. spot exchange-traded fund (ETF) net flows.
Analysts at Glassnode noted that while the asset remains structurally resilient, supported by the defensive positioning of long-term holders, on-chain metrics such as the realized P&L ratio suggest that capital inflows are fading and the market remains well below levels historically associated with aggressive bull markets. Rather, Bitcoin closely tracks global risk appetite rather than decoupling it from macro markets.
Wednesday’s price decline accelerated derivatives eliminations, with $115.3 million in leveraged Bitcoin positions being liquidated. This was a 15% increase from the $100 million-plus recorded the previous day. Long bets bore the brunt of the volatility, accounting for nearly $106 million in Bitcoin liquidations. This flashout highlights Glassnode’s warning against increasingly crowded long positions in the futures market. On May 27, total liquidations across the broader crypto market reached $334 million, with long positions accounting for $285.6 million of the residue.
Stock prices remain stable despite falling energy prices
In contrast to Bitcoin, global stocks were mostly flat, with South Korea’s Kospi index the only outlier after surging more than 180 points (2.25%). Analysts attribute the rise in stock prices to a sharp drop in energy prices and growing optimism about diplomatic developments in the Middle East. As of this writing, Brent crude oil had fallen to just over $95 per barrel and West Texas Intermediate (WTI) was below $90 per barrel.
The drop in oil prices comes as reports that diplomatic talks between the US and Iran may be in the final stages, allaying fears of escalating regional conflicts and persistent supply blockages.
But despite growing optimism about the possibility of a diplomatic breakthrough, participants in decentralized prediction markets remained skeptical. At Polymarket, traders see only a 30% chance that the US and Iran will reach a deal by May 31. Similarly, in Karshi, the implied probability that the Strait of Hormuz would be fully open before July 1 was only 36%.
