Bitcoin and Ethereum prices retreated on Thursday, erasing gains from earlier in the week, as spot Bitcoin and Ethereum ETFs saw significant outflows. The renewed selling pressure coincided with diminishing hopes for a quick end to the US-Iran conflict, which rattled broader financial markets.
According to data from SoSoValue, spot Bitcoin ETFs experienced outflows of over $227 million on Thursday, a sharp reversal from the $461 million in inflows recorded the previous day. Spot Ethereum ETFs also saw $90 million in outflows, following a day of $169 million in inflows. Other crypto ETFs, including those for XRP, Solana, and Hedera, also registered outflows. The cumulative inflows for Bitcoin ETFs since inception stand at $55 billion, with BlackRock's IBIT holding the largest market share.
The market downturn was triggered by geopolitical developments. Earlier optimism, fueled by reports of Iran seeking talks with the US, was dashed when Iran denied these allegations. This caused ceasefire odds on platforms like Polymarket to fall. Further reports, including one from Politico, suggested the US administration is considering a conflict that could extend until September, involving strategies like funding Kurdish forces to create internal chaos in Iran.
This prolonged war risk contributed to a sell-off in traditional markets, with the Dow Jones Index falling over 785 points. The concern is that sustained high energy prices (crude oil and natural gas) could compel the Federal Reserve to maintain or even raise interest rates, creating a hostile environment for risk assets like cryptocurrencies.
Technically, Bitcoin failed to hold above $71,000, retreating to near $70,000 after reaching a weekly high of $74,500. It remains below the 23.6% Fibonacci Retracement level at $75,720 and the dynamic resistance of the 50-day Exponential Moving Average (EMA). Ethereum price also fell to around $2,085, continuing to trade within a range between $1,812 and $2,185 since early February, with chart analysis pointing to a potential bearish breakdown.
Amid the broader market caution, several altcoins showed explosive gains. OKB surged 26%, fueled by a reported $25 billion investment from Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange. Humanity Protocol (H) jumped 30%, and Kite (KITE) rallied 21%, with the latter seeing its futures open interest surge 35% to $102.48 million, indicating strong speculative interest in the AI-themed token.
