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Bitcoin and Ethereum Closed May in the Red Due to Nearly $3 Billion in ETF Outflows and Geopolitical Tensions
- Bitcoin’s monthly price decline amounted to 3.4%, while Ethereum lost more than 11% of its value.
- For Bitcoin, this marked the seventh negative May in history, while for Ethereum, the decline occurred only for the fourth time since the asset’s inception.
- Meanwhile, investors withdrew a record amount of funds from crypto investment products based on these assets during the month.
In May 2026, the cryptocurrency market ended the month in the red. Bitcoin lost 3.41%, while Ethereum declined by 11.07%, according to CoinGlass data.
For the leading cryptocurrency, this was the seventh negative May on record, whereas Ethereum closed the month at a loss for only the fourth time throughout its existence.
Bitcoin monthly returns. Source: CoinGlass.
Ethereum, in turn, ended May with a worse performance than Bitcoin. The asset lost more than 11% despite a number of fundamental developments within the ecosystem, including the growth of the Ethereum ETF market and new privacy and network security initiatives.
After a strong April, when Bitcoin gained 11.87% and Ethereum rose by 7.3%, investors faced several factors that increased pressure on the market.
Ethereum monthly returns. Source: CoinGlass.
In particular, tensions escalated in the Middle East toward the end of the month: Iran and the United States exchanged strikes, while the ceasefire between the sides came under threat. Against this backdrop, both stock and cryptocurrency markets entered a correction phase, and Bitcoin temporarily fell below $73,000.
ETF Outflows and Declining Demand
Another negative factor for the market was the record outflow of funds from exchange-traded crypto products.
Between May 1 and May 29, the spot Bitcoin ETF sector recorded its largest monthly capital outflow of 2026, totaling $2.43 billion, according to SoSoValue data. Only the first trading week of the month was positive for the funds, while investors consistently withdrew capital afterward.
Capital inflow/outflow dynamics of U.S. spot Bitcoin ETFs. Data: SoSoValue.
The largest losses were recorded by BlackRock’s IBIT fund, which saw $1.41 billion withdrawn. Meanwhile, Morgan Stanley Bitcoin Trust was the only fund to post positive results, attracting $68.98 million.
A similar situation was observed in the Ethereum ETF sector. By the end of May, net outflows totaled $540.88 million, also the largest negative result since the beginning of the year. For Ethereum-based funds, this marked the fourth month of outflows in 2026, with April being the only positive month.
Capital inflow/outflow dynamics of U.S. spot Ethereum ETFs. Data: SoSoValue.
Among Ethereum funds, four products posted the largest losses, including iShares Ethereum Trust (ETHA). At the same time, five funds ended the month with net inflows, while the leader was iShares Staked Ethereum Trust ETF (ETHB), which attracted $35.73 million.
Against this backdrop, additional attention was drawn to the decision by Yorkville America, which cooperates with Trump Media & Technology Group (TMTG), to withdraw its application for a spot Truth Social Bitcoin ETF. The company also suspended work on two other funds. Officially, the move was attributed to structural issues related to ETF registration under the Securities Act of 1933, although some experts linked the decision to intense competition in the market.
Strategy and Institutional Investors Increased Market Concerns
Earlier in the month, Strategy co-founder Michael Saylor stated that the company does not rule out selling part of its reserves to cover dividend obligations.
At the end of May, Strategy transferred 411.48 BTC, worth approximately $30 million, to the Coinbase Prime platform. This fueled speculation in the market about a potential sale of assets.
Investor sentiment was further pressured by data from the CryptoQuant analytics platform. Experts reported that Bitcoin’s Apparent Demand indicator fell to approximately -147,000 BTC, its lowest level since the beginning of 2026.
Analysts noted that without a recovery in spot demand, it would be difficult for Bitcoin to maintain sustainable growth. At the same time, they emphasized that such periods have historically often created opportunities for long-term investors.
At the time of writing, Bitcoin was trading at $73,132, according to TradingView.
Daily BTC/USDT chart on Binance. Source: TradingView.
Meanwhile, Ethereum was trading at $1,985.
Daily ETH/USDT chart on Binance. Source: TradingView.
