After soaring past $82,000 earlier in the week, Bitcoin briefly fell below $79,000 before recovering close to $80,000.
Analysts say the selloff was not a random occurrence but the result of three simultaneous pressures weighing on the market.
What On-Chain Data Indicated Before the Drop
Warning signs appeared well before prices moved. On-chain analyst Easy On Chain noted that exchange outflows on May 11 collapsed to 19,995 BTC. That figure is far below the early May range of 28,000 to 35,000 BTC and substantially under the period’s daily average of 25,600 BTC.
A sharp decline in outflows means fewer coins were being withdrawn from exchanges, increasing the sell-side supply remaining on trading platforms. Easy On Chain describes this situation as a “positive Netflow,” which weakens the market’s ability to absorb downward pressure.
At the same time, the derivatives market was signaling a potential decline. Between May 8 and 10, open interest rose to 1.04 times the period’s average, while funding rates turned negative and continued to deepen through May 10.
This combination shows traders were building short positions in anticipation of a drop. When selling pressure arrived, it hit a market filled with leveraged long positions that lacked room to maneuver.
“On May 12 alone, long liquidations reached 11.8 times the short liquidations,” the analyst observed. “Over three days (May 11–13), roughly $109.7 million in long positions were forcefully liquidated, acting as the primary driver of the crash.”
Additionally, the release of US CPI and PPI data—alongside rising inflation concerns—provided traders with a clear trigger to act.
Another analyst, Carmelo Alemán, linked the move to concentrated whale selling. He reported that wallets holding between 1,000 and 10,000 BTC sold about 7,650 BTC during the decline, equivalent to roughly $616 million at average prices near $80,500.
During that period, Bitcoin fell from around $81,000 to under $79,000 while open interest increased by almost $590 million, indicating that fresh leverage flowed into the market even as prices dropped.
Where Bitcoin Stands Now
At the time of writing, BTC was trading just under $80,000, down about $300 from that mark. The coin lost roughly 2% in the past 24 hours and a similar 2% over the previous seven days.
Over 30 days, Bitcoin is up nearly 7%, but it remains down more than 23% year-over-year and sits over 36% below its October 2025 all-time high near $126,000.
Easy On Chain advises traders to watch two key indicators: whether exchange netflows shift back to negative—signaling renewed withdrawals—and whether liquidation pressure on leveraged longs begins to ease. Until both signals point to improving conditions, attempts to reclaim $82,000 may continue encountering resistance.