Bitcoin taking strain

Bitcoin weakened to its lowest level in more than two weeks as broad macro risks stemming from the US-Iran war prompted traders to cut back their positions.

The original cryptocurrency fell as much as 2.2% to $76,551 on Monday, the lowest since May 1, before paring some losses. It was hovering around $77,300. Other tokens, including Ether and Solana, also fell.

Bitcoin’s price slumped as cryptocurrencies across the board saw nearly $500 million in liquidations of bullish bets within 15 minutes during early Asia trading on Monday, according to Coinglass data.

Almost $700 million in bullish positions were unwound in the past 24 hours, Coinglass’s data shows.

The token has been under pressure in recent days as uncertainty around the US war with Iran weighed on risk assets.

US-listed spot Bitcoin exchange-traded funds saw more than $1 billion in outflows last week for the first time since late January.

“Bitcoin’s pullback is a macro story,” said Rachael Lucas, an analyst at BTC Markets. “Risk appetite has repriced, and Bitcoin is moving with it.”

Meanwhile, Strategy Inc. said it acquired $2.01 billion of Bitcoin in the seven days ended May 17. That was the highest total in four weeks by Michael Saylor’s Bitcoin accumulator.

The former MicroStrategy funded the bulk of the purchases with the proceeds from the sale of $1.95 billion of its Stretch perpetual preferred shares.

The former enterprise software maker also sold $83.7 million in common stock. Strategy owns about $64 billion in Bitcoin, making it the largest corporate holder of the digital currency.  

Oil prices climbed on Monday while bond yields rose and stock futures declined. The negative sentiment came amid a lack of progress in reopening the Strait of Hormuz, a critical trade waterway.

President Donald Trump said the “clock is ticking” for Iran to make a deal.

Bitcoin liquidations were triggered as the cryptocurrency fell through a key support level around $77,800. Structural support remains between $76,000 and $76,800, Lucas said, while a close above $80,000 “would be the first meaningful signal that selling pressure is exhausting.”

Bearish bets were concentrated at $77,500 with traders buying about $38 million in Bitcoin put options for May 18 expiry, according to Deribit data, underscoring negative sentiment.

The sudden fall in Bitcoin prices “appears to have triggered a stop run in the absence of any macro headlines,” said Sean McNulty, Asia-Pacific derivatives trading lead at FalconX.

The weakness was “compounded by lingering downside hedging from last week,” he added.