Hormuz Shock Erupts! Bitcoin Plunges to One-Month Low

▲ Strait of Hormuz, Bitcoin/ChatGPT generated image ©

As oil prices surpassed $95 per barrel, Bitcoin (BTC) has once again been hampered by macroeconomic variables. Amid concerns of a US-Iran conflict and outflows from spot ETF funds, BTC fell to its lowest level in a month, with warnings from the market that “the defense of $70,000 is a key variable.”

According to investment media FXStreet on May 28 (local time), BTC dropped to $74,000 during Singapore trading, marking its lowest point since April 13. Ethereum (ETH) fell more than 4% to approximately $1,960, and the total cryptocurrency market capitalization shrunk by about 3.5% to around $2.44 trillion. The media reported that with the collapse of support levels maintained for several weeks, there is a possibility of a further decline in market capitalization below $2.3 trillion.

The continuous outflow of funds from cryptocurrency spot ETFs for two consecutive weeks has also increased market pressure. Last week, over $1.3 billion flowed out of the cryptocurrency spot ETF market. BTC maintained a bearish trend throughout last week and is currently trading near the 50-day moving average support zone. Furthermore, with Bitcoin mining costs rising more than 10% above current market prices, some mining companies are reportedly selling their holdings and newly mined coins to secure operating funds.

Ivan Patriki, co-founder of market analysis platform QuantMap, diagnosed that a prolonged blockade of the Strait of Hormuz is fueling oil price increases and delaying expectations for interest rate cuts by the US Federal Reserve (Fed). He explained, “In a high oil price environment, macroeconomic variables once again become the key filter for all risk assets,” adding, “BTC will also find it difficult to stably break through key psychological price levels.”

Patriki analyzed that investors are currently awaiting strong headlines such as the reopening of the Strait of Hormuz or a US-Iran negotiation settlement. However, market sentiment suggests that reactions to US President Donald Trump’s remarks are also gradually slowing down. He stated, “As long as oil prices remain above $95, it is difficult to expect a sustained upward rally for BTC with short-term positive news alone,” and “Without actual de-escalation of tensions and normalization of the Strait of Hormuz, BTC is likely to continue to be influenced by oil prices, the dollar, and interest rate expectations.”

Conversely, institutional and corporate investor buying continues. Strategy recently purchased approximately 25,000 BTC, increasing its total holdings to 843,737 BTC. This is the largest purchase in the past two years, excluding the 34,000 BTC purchase in April 2026. However, US Bitcoin spot ETFs and Ethereum spot ETFs experienced outflows of $730 million and $67 million, respectively, with cumulative outflows from BTC spot ETFs exceeding $2.6 billion since May 15.

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