Bitcoin Drops Below $73K as IBIT Sheds $528M and $1B in Longs Liquidate

Bitcoin News

Bitcoin slipped beneath $73,000 in early Thursday trading as U.S. spot Bitcoin ETFs registered their heaviest net outflows since late January. The leading cryptocurrency fell roughly 3.6% over 24 hours to $72,842, while Ether dropped 4.8% to $1,974, XRP shed 3.5% and Solana lost 3.6%. Analysts attribute the decline to a broad risk-off rotation driven by profit-taking near recent highs, climbing Treasury yields and renewed geopolitical anxiety. The U.S. spot Bitcoin ETF complex bled $733.4 million on Wednesday alone, marking the largest single-day redemption since Jan. 29 and amplifying selling pressure across crypto majors throughout Asian trading hours.

BlackRock's iShares Bitcoin Trust posted a $527.84 million net outflow, the second-largest single-day redemption since the fund's January 2024 debut and just under half a million dollars short of the all-time record set on Jan. 30. IBIT now manages roughly $59 billion in assets and represents close to 4% of circulating supply. The wider 11-fund complex has now logged consecutive sessions of redemptions, with over $2 billion withdrawn across the past fortnight. Fidelity's FBTC lost $60.3 million and Grayscale's GBTC shed $104.76 million, while Morgan Stanley's MSBT was the only fund to record positive flows at $4.3 million.

Technical conditions deteriorated sharply after Bitcoin lost the $75,000 support that traders had defended for weeks. Funding rates remain mildly positive and aggregated open interest is holding, indicating long positions are being topped up rather than closed en masse, but a negative Coinbase premium signals waning U.S. spot demand. Hyblock data shows retail long exposure near 62%, a zone historically associated with crowded positioning. Investors are bracing for Thursday's Personal Consumption Expenditures release for April, with Bitfinex analysts warning that aggregate futures open interest has fallen sharply since May 15 as the asset retraced more than 10% from highs above $82,000.

Despite the sell-off, ARK Invest chief executive Cathie Wood reiterated a base case of approximately $750,000 per coin by 2030, with a bull scenario reaching $1.25 million. Speaking on Fox Business, Wood pointed to three structural drivers: generational wealth transfer toward digital stores of value, Bitcoin's role as insurance against monetary debasement in emerging markets, and accelerating institutional allocation. She pushed back on critics arguing the asset has failed as a hedge during recent volatility, framing short-term weakness as noise relative to the secular thesis. Wood also emphasized that low correlation to traditional assets makes Bitcoin a tool every allocator should evaluate for risk-adjusted return enhancement.

Corporate treasury narratives drew fresh attention as merger speculation around Elon Musk's SpaceX and Tesla resurfaced. Recent filings show the two companies collectively hold more than 30,221 BTC valued near $2.27 billion. SpaceX disclosed an 18,712 BTC position in its IPO documentation, acquired at a cost basis of roughly $661 million, while Tesla retains 11,509 BTC worth about $862 million. A combined entity would rank fifth among publicly traded Bitcoin treasuries, intensifying the corporate-balance-sheet thesis that has reshaped institutional positioning since 2024. Musk has previously merged X with xAI and is reportedly folding xAI into SpaceX, lending credibility to the consolidation chatter.

Fund manager Michael Kramer of Mott Capital Management warned that upcoming U.S. Treasury settlements between May 28 and June 5 could drain roughly $150 billion in liquidity. The schedule includes $15 billion in T-bills settling Thursday, $47 billion in coupon settlements Friday, and $68 billion on Monday. Bitcoin has historically tracked global liquidity conditions more tightly than equities, and Kramer argues the recent breakdown of the $75,000 support reflects tightening cash availability. Adding another dimension, Kraken launched a non-custodial Bitcoin yield vault offering 2.5% annualized returns through kBTC, attracting $30 million in deposits from roughly 4,000 wallets within ten hours of going live.

With spot trading near $73,473 and a 24-hour decline of 3.24%, momentum readings confirm the bearish posture: RSI at 35.29 sits just above oversold, and MACD remains negative on the daily. Initial support stands at $72,661, with deeper bids at $70,644 and a critical structural floor at $66,862. Reclaiming $74,441 and then $76,234 is the minimum required to neutralize the downtrend, while a push above $78,592 would invalidate the bearish thesis. A weekly close beneath $70,644 alongside continued ETF redemptions would open a path toward the $66K shelf, particularly if PCE data and Treasury settlements compound the current bear market pressure.