A market report released by Finestel shows that Bitcoin closed at approximately $70,600 during the May correction, down about 8% to 10% from its monthly high. The report attributes this decline to stronger-than-expected inflation data, rising US Treasury yields, and increased risk aversion due to the situation in the Middle East.

Falling below the short-term holder's cost line

The report states that Bitcoin previously failed to hold the $81,000 to $85,000 range, subsequently falling below approximately $78,200 to $78,300, and also breaching the overall market cost line of approximately $78,277. This means that some investors who entered the market at higher levels are now facing paper losses, and if the price rebounds to $75,000 to $78,000, more significant selling pressure may emerge in that range.

Finestel believes that current support is mainly concentrated between $70,000 and $73,000. On-chain data also shows that recent selling pressure has come more from short-term holders, while long-term holders are generally still holding their coins. The difference in cumulative spot trading volume data indicates that when the price fell back to between $70,000 and $77,000, the market saw some buying support.

Funds continue to concentrate in Bitcoin

The report shows that from the beginning to the end of May, Bitcoin's market capitalization share rose from approximately 58% to over 61%, indicating that funds continued to concentrate on Bitcoin during the correction phase, putting greater pressure on riskier crypto assets. During the same period, Ethereum fell more than Bitcoin, declining by approximately 12% to 15%.

According to the report, the total market capitalization of the cryptocurrency market had decreased from approximately $3.05 trillion to approximately $2.45 trillion by the end of May. Bitcoin, meanwhile, fell from a high of over $82,800 to approximately $70,600.

Institutions increase stablecoin and cash positions

Finestel's data on professional asset managers tracked by assets under management shows that although the market has experienced a correction, institutions have not engaged in large-scale liquidation, but rather have shifted to a more conservative allocation strategy.

Among these, the combined allocation to Bitcoin and Ethereum rose slightly from 54.5% to 55.5%; stablecoin allocation increased from 23% to 27%, indicating that institutions are increasing their liquidity reserves. Meanwhile, the allocation to yield-generating DeFi and real-world asset strategies decreased from 13.5% to 12%, and the allocation to high-confidence altcoins decreased from 9% to 5.5%, with leverage levels also declining accordingly.

The report states that many managers began gradually reducing risk during the market rebound in mid-May, while maintaining core positions in Bitcoin and Ethereum. Finestel believes that for Bitcoin to achieve a sustained recovery, it needs to regain the $78,000 level, and the macroeconomic environment also needs to improve.