'Institutional bid hasn't disappeared': Analysts say bitcoin cooldown, spot ETF outflows signal rotation, not exit

Bitcoin (BTC) held below $78,000 on Monday as U.S.-Iran deal speculation threatened a volatile open across holiday-thinned markets, The Block's price page shows.

The market tension followed $1.26 billion in net outflows from spot bitcoin exchange-traded funds the week of May 18–22 — their second consecutive billion-dollar redemption week — even as BTC briefly cleared $82,000, The Block reported.

Bitcoin had previously found its footing mid-week after Strategy disclosed a purchase of roughly 25,000 BTC for $2 billion between May 11 and May 17, stabilizing the price after an earlier geopolitically driven sell-off, Laser Digital wrote.

Rotation, not exit

Timothy Misir, head of research at BRN, argued that tepid prices amid surging institutional outflows carries more weight than the headline rally. “The institutional bid hasn't disappeared — it's rotating,” he stated.

While spot BTC products logged redemptions, XRP (XRP) ETFs attracted $22 million, Solana (SOL) ETFs added $16 million, and newly launched Hyperliquid (HYPE) ETFs pulled in $72 million during the same window that Ethereum (ETH) ETFs shed $216 million, according to BRN.

ETH also came under pressure after a late-Friday SEC announcement delaying plans to allow trading in tokenized stocks, which helped drag the asset lower through the weekend. A partial recovery followed Sunday as Iran deal headlines lifted risk appetite more broadly, according to Laser Digital's derivatives desk.

On the options side, implied volatility for bitcoin and ether drifted lower as spot stayed pinned in a plus-or-minus 1% band.

Put skew remains rich and is expected to hold, Laser Digital added. A major expiry on May 29 has the heaviest open interest at the $75,000 put and $80,000 call for BTC, and the $2,100 put for ETH.

Macro

With U.S. and European markets closed Monday for public holidays, Capital.com senior analyst Kyle Rodda warned of a gappy open and choppy price action as Iran deal headlines circulate.

A deal, if it materializes, would likely push crude prices sharply lower and equity indices toward record highs on a repricing of inflation risk, Rodda wrote. Lingering sticking points, including  Iran's nuclear program, uranium enrichment, and control of the Strait of Hormuz, leave that outcome far from certain.

U.S. personal spending, core PCE, and Q1 GDP data are all due this week, readings that could either validate the tight-range thesis or force a broader repricing, multiple analysts noted.