Bitcoin holds near $73,000 as regulatory uncertainty offsets macro gains

Bitcoin traded near $73,000 on May 29, down nearly 6% for the week, as institutional investors focused on upcoming U.S. cryptocurrency regulations rather than positive macro conditions.

"Long-term holder supply has grown to 15.8 million BTC, a new all-time high, but this configuration is bearish because it shows the absence of new market entrants," CryptoQuant wrote in a report. The analytics firm noted that whale balances — wallets holding 1,000 to 10,000 BTC — have declined over the past year, a distribution pattern that directly mirrors the 2022 bear market.

The decline came as spot Bitcoin ETFs recorded eight consecutive days of net outflows, with $733 million exiting on May 27 alone and more than $2 billion since mid-May, according to SoSoValue data. Over $900 million in crypto positions were liquidated during the selloff, concentrated in over-leveraged long positions, market data shows. Bitcoin's 24-hour trading volume reached $44 billion, above its seven-day average, indicating active repositioning rather than market exit.

Bitcoin now sits 42% below its October all-time high of $126,080, with the $72,650 support level representing the key threshold separating consolidation from deeper losses. A break below that level could expose the $70,000 handle, where prediction market platform Myriad shows growing odds of a sub-$70,000 print before May ends.

ETF Outflows and Whale Distribution Deepen the Selloff

Spot Bitcoin ETF outflows have accelerated through May, with the streak of eight consecutive negative days marking one of the longest since the products launched. The largest single-day pressure point came from a $1.3 billion institutional block trade involving BlackRock's iShares Bitcoin Trust (IBIT), executed through private market channels before the impact was reflected in spot markets, according to market participants.

On-chain data from CryptoQuant shows that both whale and dolphin cohorts — those holding 100 to 1,000 BTC — have effectively stalled on a monthly basis. When these groups simultaneously fail to add Bitcoin, it typically precedes sustained price weakness because they represent the primary source of structural demand support, the firm said.

Regulatory Fog Clouds an Otherwise Bright Macro Picture

The divergence between Bitcoin and traditional markets has widened this week. Global equities reached record highs, and reports of a potential 60-day US-Iran ceasefire awaiting President Donald Trump's approval helped ease geopolitical risk premiums across asset classes. Yet Bitcoin failed to participate in the rally.

The Personal Consumption Expenditures index, the Federal Reserve's preferred inflation gauge, rose to 3.8 percent year-over-year in April, its highest since 2023, according to the Bureau of Economic Analysis. The reading pushed fed funds futures to price out near-term rate cut expectations, adding headwinds for rate-sensitive crypto assets.

Traders are now watching the $70,800 level, which if held would preserve a multi-month uptrend by confirming a higher low, according to technical analysis from Castillo Trading. The 14-day relative strength index at 34.82 places Bitcoin near oversold territory, increasing the likelihood of short-term relief bounces within the broader downtrend.

This article is for informational purposes only and does not constitute investment advice.