05/27 update below. This post was originally published on May 26
Bitcoin has resumed its downward trend following a bitcoin price bounce through April (despite Elon Musk revealing a $1.4 billion bitcoin surprise).
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The bitcoin price, down 40% from its all-time high in October last year, has failed to hold onto the closely-watched $80,000 per bitcoin level, with billionaire Mark Cuban suddenly flipping on bitcoin and crypto.
Now, as traders brace for a White house crypto market game-changer, a “bloodbath” bitcoin price warning has been issued as traders flee BlackRock’s bitcoin exchange-traded fund (ETF).
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Bitcoin has struggled to regain momentum, with analysts warning a huge bitcoin price crash could be looming as investors flee BlackRock’s bitcoin fund.
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“Bitcoin price action could turn into a bloodbath quickly,” one widely-followed crypto analyst posted to X, pointing to technical chart analysis that showed the “last time bitcoin got rejected from the topside of this bear flag, it dumped nearly 40% in 23 days.”
A 40% bitcoin price crash would plunge the price back to just over $40,000 per bitcoin, a level not seen since before U.S. president Donald Trump retook the White House in late 2024, promising to make the U.S. the world’s crypto capital.
05/27 update: The crypto market has been hit by news that a BlackRock bitcoin fund whale has yanked almost $1.3 billion from the asset manager’s IBIT exchange-traded fund (ETF) in a single transaction.
“Massive $1.3 billion IBIT block sale by unknown party through dark pool … biggest such trade i’ve ever seen,” Alex Thorn, head of research at Galaxy, posted to X, exacerbating fears that the bitcoin and crypto ETF boom is coming to an end just as bitcoin buying company Strategy could see its debt and equity-fueled acquisition spree come to an end.
“Are the wheels coming off, one by one,” analysts with 10X Research, led by Markus Thielen, wrote in an emailed note, pointing to Strategy’s “signal that it may sell bitcoin, with only six months of cash remaining to cover dividend obligations,” as “strongly” suggesting “the company will no longer serve as a meaningful buyer” of bitcoin.
“That removes one of the most visible and consistent demand drivers of the past several years,” 10X researchers wrote.
The bitcoin price slipped to $74,000 per bitcoin following the BlackRock whale sale, with traders braced for further declines.
“As expected, bitcoin has now fallen back to the $75,000 range after failing to build enough momentum to move up toward the $90,000 level,” Koinly chief executive Robin Singh said in emailed comments.
“For now, bitcoin could continue chopping sideways in the low-to-mid $70,000 range over the coming months. But it still feels like the market has not experienced a true capitulation or ‘true bottom’ moment yet. There is a real possibility that bitcoin revisits the $60,000 level seen earlier in the year, particularly if macro conditions weaken or momentum continues fading.”
The bitcoin price has been supported by hopes the crypto market structure bill known as the Clarity Act could be passed within the next couple of months, however, this could already be “priced in.”
“Much of the industry continues pointing to the Clarity Act as a bullish catalyst, but there is a high chance that any optimism tied to the legislation may already be priced in,” Singh said.
“At this stage, the market broadly expects the bill to pass this year, meaning the surprise factor, and potentially the upside reaction, could already be exhausted. Rather than triggering another explosive leg higher, the recent rally may simply have reflected traders front-running the narrative.”
Meanwhile, traders have continued to exit bitcoin ETFs as geopolitical risk weighs on cryptocurrencies.
Global crypto investment products, including the largest U.S. ETFs issued by asset managers such as BlackRock, Fidelity, and 21Shares, lost almost $1.5 billion last week, a second consecutive negative week and the third-largest weekly outflow of 2026, according to CoinShares.
“Cumulative outflows over the two weeks now stand at $2.5 billion, suggesting the Iran-related risk-off has deepened and broadened despite continued Clarity Act progress,” CoinShares head of research James Butterfill wrote in a report, referring to the crypto market structure bill that is still being negotiated by U.S. lawmakers.
The latest bitcoin price boom that saw bitcoin hit an all-time high of $126,000 per bitcoin in October last year, was fueled by the likes of BlackRock buying huge volumes of bitcoin for their ETFs.
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The bitcoin price has lost momentum after topping $80,000 per bitcoin, raising fears of another bitcoin price crash.
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BlackRock has become world’s largest corporate holder of bitcoin after Michael Saylor’s Strategy, buying just over 800,000 bitcoin on behalf of investors since its bitcoin fund was given the green light by regulators in early 2024.
“The bigger negative factor for bitcoin remains ETF flows,” Linh Tran, market analyst at XS.com, said in emailed comments, pointing to SoSoValue data that showed U.S. spot bitcoin ETFs recorded six consecutive sessions of net outflows from May 15 to May 22, with total net outflows of around $1.5 billion.
“On May 18 alone, net outflows reached $648 million, with BlackRock’s IBIT seeing outflows of $448 million. This suggests that institutional demand remains relatively weak, leaving the current rebound without enough support to confirm a sustainable upward move,” Tran said.
“If the bitcoin price fails to reclaim [$80,000], selling pressure could return, especially as ETF flows remain negative and the macro environment is still not fully supportive.”