Bitcoin fell as low as $76,551 during early Asian trading on Monday, marking its lowest level since May 1. According to Bloomberg reporting on May 18, widespread risk-off sentiment triggered by the Middle East situation led traders to dramatically reduce positions, resulting in nearly $500 million in crypto market liquidations within just 15 minutes.

What does this price mean? On May 1, Bitcoin opened around $76,306. Over the following two weeks, it surged past $82,000 before declining for four consecutive trading days, erasing all monthly gains. For traders who chased the rally mid-month, unrealized profits turned into losses within 48 hours—so quickly that reaction was nearly impossible.

PPI Rises 6% YoY, Highest in Three Years; Rate Hike Probability Jumps to 39%

The catalyst for this sell-off was the U.S. April Producer Price Index (PPI) report released on May 13. According to the U.S. Bureau of Labor Statistics, PPI rose 1.4% month-over-month—the largest single-month increase since March 2022—and surged 6% year-over-year, the highest level since December 2022, far exceeding the market consensus of 4.9%.

Energy prices were the primary driver. Gasoline prices jumped 15.6% month-over-month in April, while diesel prices rose 12.6%, reflecting the downstream impact of the Iran conflict on the energy complex. Even excluding food and energy, core PPI rose 1% month-over-month and 5.2% year-over-year, indicating that inflationary pressures extend beyond fuel pumps.

Carl Weinberg, Chief Economist at High Frequency Economics, warned after the PPI release that the data would trigger alarms at both the Federal Reserve and financial markets. The CME FedWatch tool shows the market-implied probability of a 25 basis point rate hike this year has risen to approximately 39%, effectively eliminating any expectation of rate cuts for the year.

Just one day before the PPI data, April CPI rose 3.8% year-over-year—the highest since May 2023. According to CNN, multiple economists have upgraded their forecasts for May CPI following the PPI release, anticipating it will exceed 4%. The transmission of wholesale price pressures to consumer prices is accelerating.

ETF Inflows End After Six Weeks, Weekly Net Outflows Exceed $1 Billion

Macro-level pressure quickly filtered into institutional capital flows. According to SoSoValue data, the U.S. Bitcoin spot ETF recorded net outflows of approximately $1 billion in the week ending May 15, ending six consecutive weeks of net inflows. CoinShares reported on May 18 that digital asset investment products experienced total net outflows of $1.07 billion, the third-largest weekly outflow since 2026.

James Butterfill, Research Director at CoinShares, stated this shift “may reflect geopolitical risk-off sentiment triggered by developments related to Iran.”

The cumulative net inflows over the previous six weeks totaled about $3.4 billion, averaging $568 million per week. In April alone, inflows reached $1.97 billion—the strongest monthly performance of 2026. This accumulated position was reversed en masse this week. On May 13, net outflows hit $635 million—the largest single-day decline of the week. On May 15, none of the 11 Bitcoin ETFs recorded positive inflows, adding another $290 million in outflows.

Ethereum spot ETFs also suffered five consecutive red days, recording weekly net outflows of $255 million. As of the weekend, Bitcoin ETFs still had cumulative net inflows of $58.34 billion, with total assets under management reaching approximately $104.29 billion.

$657 Million Liquidated, 89% Long Positions

While ETF capital fled, the derivatives market underwent a brutal purge of long positions. According to Coinglass data, total liquidation value across the crypto market reached $657 million within 24 hours, with long positions accounting for approximately 89%. bitcoin.com reported that $584 million came from long liquidations. The Fear & Greed Index plummeted from a neutral 50 just days prior to 29, entering the fear zone.

The chain reaction of leveraged liquidations accelerated the downward spiral. After Bitcoin broke below key support levels, a wave of stop-losses and forced liquidations triggered a feedback loop: “liquidation → selling → further liquidation.” LMAX Crypto Strategist Joel Kruger described this process as “forced unwinding and position cleansing” pushing Bitcoin below critical technical support levels.

Bitcoin is currently trading in a range between $76,000 and $76,800. The 50-day moving average at approximately $76,716 provides short-term support, while the 200-day moving average at roughly $83,513 acts as resistance above.

Strategy Buys 20,000 BTC Against the Tide; Saylor Disagrees with Same Sentiment Report

While retail investors liquidated and ETFs hemorrhaged capital, Strategy (formerly MicroStrategy) executed a contrarian move during the same period.

According to a Form 8-K filed with the SEC on May 18, the company purchased 24,869 Bitcoin between May 11 and 17 at a total cost of approximately $2.01 billion, averaging $80,985 per coin. This transaction increased Strategy’s total BTC holdings to 843,738 coins, with a total cost basis of $63.87 billion and an average acquisition price of around $75,700. The purchase was primarily funded through the sale of STRC preferred shares.

Strategy also disclosed that its “BTC yield” (a metric measuring Bitcoin holdings relative to diluted share count growth) since the beginning of 2026 reached 12.6%.

This is not the first time Saylor has added to his position amid market panic. Throughout 2026, Strategy maintained a near-weekly or bi-weekly buying rhythm regardless of market direction. From January to May, the company increased its holdings from approximately 560,000 BTC to over 840,000 BTC, averaging nearly 60,000 BTC added per month. While everyone was focused on PPI data and ETF outflows, he spent another $2 billion acquiring Bitcoin.

Goldman Sachs Quits XRP and Solana ETFs in Q1, Keeps Only Bitcoin

If Strategy’s actions represent the stance of a “Bitcoin maximalist,” Goldman Sachs’ Q1 13F filing reflects a more representative institutional choice.

According to Goldman Sachs’ latest Q1 2026 13F filing, the firm completely exited all XRP and Solana ETF positions during the quarter. At the end of the prior quarter, Goldman held approximately $154 million in XRP-related ETFs (across issuers including Bitwise, Franklin Templeton, Grayscale, and 21Shares), along with over $100 million in Solana-related ETFs. These positions are now zero.

Ethereum ETF exposure was reduced by about 70%, falling from previous levels to approximately $114 million. Bitcoin ETF exposure remained largely unchanged at around $700 million to $720 million, with only a minor reduction of about 10%.

Meanwhile, Goldman Sachs increased its holdings in crypto infrastructure stocks: Circle shares rose 249%, Galaxy Digital gained 205%, and Coinbase also saw additional purchases. This strategic move sends a clear signal: Goldman Sachs hasn’t exited crypto—it’s narrowing its bets, shifting from “broad diversification” back to “BTC-only.”

According to CCN, Harvard University’s endowment fund also reduced its Bitcoin ETF holdings by 43% during the same period and fully exited Ethereum ETFs. Institutions are simultaneously consolidating their crypto exposure into fewer, higher-conviction assets.

Original article by Claude, DeepTide TechFlow