The cryptocurrency market experienced a sharp decline today, with Bitcoin dropping below $77,000 to $76,000 before staging a slight recovery to $76,904.8. According to CoinGlass data, more than $670 million in crypto positions were liquidated over the past 24 hours, with long traders accounting for around 95% of total losses. The broader crypto market came under heavy pressure, with Ethereum falling by around 6% toward the $2,100 level, while Solana, XRP, BNB, and Dogecoin posted losses ranging between 5% and 12%. The total crypto market capitalization declined by around 3.8% to approximately $2.56 trillion, reflecting weaker risk appetite toward digital assets.
Solana (SOL) has continued its bearish streak, dropping to $83 and closing at lower lows for six consecutive days, erasing all of May's gains. According to Bitget and CoinGlass data, the altcoin is currently trading at $84, down 2.2%, adding to its 10% weekly decline. The decline reflects strong downward momentum as the cryptocurrency experiences significant selling pressure across both spot and derivatives markets. The selling pressure has intensified dramatically with $27.3 million worth of long positions liquidated according to CoinGlass data, representing a massive exit from bullish positions.
A significant factor adding to market pressure was outflows linked to BlackRock's Bitcoin and Ethereum funds on May 15. According to data shared by crypto market watcher Crypto Patel, BlackRock clients sold around 1,722 Bitcoin worth roughly $136 million and Ethereum sales exceeded 22,600 ETH worth nearly $50 million. Despite these recent selling activities, BlackRock still holds more than 817,000 Bitcoin valued at around $63 billion and more than 3.3 million Ethereum worth approximately $7.2 billion through its investment products. These outflows were viewed by traders as another sign of caution among institutional investors at a time when market sentiment is already weak.
In a significant development that could impact crypto markets, MicroStrategy chair Michael Saylor indicated during the company's latest earnings call that the firm is now open to selling bitcoin. Saylor likened the company's philosophy to that of real estate development companies, stating "We're like a bitcoin development company. We buy it cheap. We sell it dear." The company recently bought $2 billion worth of bitcoin last week, pushing its total stockpile to 843,738 coins valued at nearly $65 billion at recent prices. MicroStrategy sold 19.5 million shares of its "Stretch" preferred stock (STRC) and a smaller amount of common stock to fund the purchase, with the average cost of its bitcoin holdings at $75,700, slightly below recent prices. CEO Phong Le noted that if the objective is to sell high-cost basis bitcoin to capture unrealized losses, the company has roughly $2.2 billion of unrealized tax benefits on its balance sheet.
Technical indicators suggest further downside potential, with the Awesome Oscillator (AO) remaining red and declining for four consecutive days, currently sitting around 0.53, indicating weak market momentum. The positive index sits below both -DI and ADX, signaling that bearish pressure is dominant in a strong trend. With the momentum downside strengthened, $83 support could breach and drop towards $81. However, spot market conditions offer some hope, with Spot Netflow remaining negative for eight consecutive days at -$2.8 million, down from -$15 million in the previous period, indicating aggressive spot accumulation that could help absorb the pressure. Despite the sharp decline, some crypto supporters believe the market may stabilize once liquidation pressure fades.
The decline came amid strong pressure tied to inflation fears, rising US Treasury yields, and geopolitical tensions. The US Producer Price Index (PPI) rose by 6% year-on-year after Consumer Price Index (CPI) data also came in above expectations, reducing hopes for an early Federal Reserve rate cut. The yield on the US 10-year Treasury note climbed from around 4.5% to 4.6%, making safer assets more attractive compared with high-risk assets such as cryptocurrencies. Some analysts believe the recent decline may have helped flush excessive leverage out of the market, which could reduce volatility in the coming days. Market participants are now watching whether Bitcoin can reclaim the $77,000 to $78,000 zone in the short term, with altcoins remaining under pressure but expected to move alongside Bitcoin if the market's largest cryptocurrency manages to find support.
