Analysis: Bitcoin Drops Below $77,000 as Geopolitical Conflicts and Inflation Concerns Trigger Sell-Off

Odaily reports that Bitcoin has fallen below the $77,000 mark, hitting a low of approximately $76,720. Analysts attribute the market decline primarily to multiple macroeconomic pressures, including the renewed escalation of tensions between the US and Iran, rising inflation concerns, and increased risk aversion across risk assets. Former US President Donald Trump issued a strong warning to Iran on social media, intensifying geopolitical uncertainty.

Meanwhile, rising oil prices have further elevated inflation expectations, with Brent crude climbing to around $111 and WTI rising above $107. This has sparked concerns that the Federal Reserve may maintain higher interest rates for a longer period.

The current selling pressure is also compounded by factors such as rising US Treasury yields, a strengthening US dollar, and ETF outflows. Data shows that Bitcoin ETFs saw net outflows of approximately $1 billion in the week ending May 17, ending six consecutive weeks of net inflows.

In terms of market sentiment, the Bitcoin Fear and Greed Index has fallen back to 27, re-entering the "fear zone." Analysts believe that short-term trends will remain highly dependent on macroeconomic data and policy expectations. However, some institutions view the current correction as a "healthy digestion" period, suggesting the long-term structure remains unchanged. (The Block)