Bitcoin Reverses May Gains Over Past Two Days; ETF Inflows End After Six Weeks—Is This a Shakeout or a Trend Reversal Signal?
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Bitcoin Reverses May Gains Over Past Two Days; ETF Inflows End After Six Weeks—Is This a Shakeout or a Trend Reversal Signal?
Retail investors are selling off, while institutions are buying.
Navigating Web3 tides with focused insightsAuthor: Claude, TechFlow
TechFlow Insight: Bitcoin dropped below $77,000 on Monday, retreating to its May 1 opening level—erasing a 48-hour gain that had accumulated over the prior two weeks. Multiple catalysts converged: U.S. April PPI surged 6% year-on-year—the highest in three years; bitcoin spot ETFs recorded over $1 billion in net outflows for the week, ending six consecutive weeks of inflows; and the crypto market suffered $657 million in liquidations within 24 hours. While retail investors panicked and fled, Strategy (formerly MicroStrategy)逆势 invested $2 billion to acquire nearly 25,000 BTC. Meanwhile, Goldman Sachs exited all its XRP and Solana ETF positions in Q1, slashed its Ethereum ETF exposure by 70%, and retained only ~$700 million in bitcoin ETF holdings. Institutional preferences are becoming increasingly clear: either avoid crypto entirely—or go all-in on bitcoin alone.
Bitcoin fell as low as $76,551 during Monday’s Asian morning session—the lowest since May 1. According to a Bloomberg report dated May 18, broad-based risk-off sentiment triggered by Middle East tensions prompted traders to significantly reduce positions, leading to nearly $500 million in liquidations across the crypto market within 15 minutes.
What does this price mean? On May 1, bitcoin opened at approximately $76,306. Over the following two weeks, it climbed above $82,000 before falling for four consecutive trading days—fully erasing the month’s gains. For traders who chased the rally mid-month, profits turned into losses within 48 hours—a reversal so rapid it barely allowed time to react.
PPI Up 6% YoY—Highest in Three Years; Rate Hike Probability Rises to 39%
The immediate trigger for this sell-off was the U.S. April Producer Price Index (PPI), released on May 13. According to the U.S. Bureau of Labor Statistics, PPI rose 1.4% month-on-month—the largest single-month increase since March 2022—and soared 6% year-on-year—the highest since December 2022 and well above the consensus forecast of 4.9%.
Energy prices were the primary driver. Gasoline prices jumped 15.6% month-on-month in April, while diesel prices rose 12.6%. The impact of the Iran conflict on the energy complex is now propagating down the supply chain. Even excluding food and energy, core PPI rose 1% month-on-month and 5.2% year-on-year—indicating inflationary pressures have extended far beyond the pump.
Carl Weinberg, Chief Economist at High Frequency Economics, warned after the PPI release that the data would trigger alarm bells both at the Federal Reserve and across financial markets. The CME FedWatch tool shows the market-implied probability of a 25-basis-point rate hike this year has risen to ~39%, with expectations for rate cuts this year effectively priced out.
Just one day before the PPI release, April CPI rose 3.8% year-on-year—the highest since May 2023. According to CNN, multiple economists revised their May CPI forecasts upward following the PPI data, expecting it to exceed 4%. The pass-through from wholesale to consumer prices is accelerating.
ETF Inflows Halted After Six Weeks; Weekly Net Outflows Exceed $1 Billion
Macroeconomic pressure quickly translated into institutional capital flows. According to SoSoValue data, U.S. bitcoin spot ETFs recorded ~$1 billion in net outflows for the week ending May 15—ending six straight weeks of net inflows. A May 18 report from CoinShares showed digital asset investment products posted $1.07 billion in net outflows—the third-largest weekly outflow of 2026.
James Butterfill, Research Director at CoinShares, stated this shift “may reflect geopolitical risk-off sentiment linked to developments concerning Iran.”
The previous six-week cumulative inflow totaled ~$3.4 billion—averaging ~$568 million per week—with April alone seeing $1.97 billion in inflows—the strongest monthly performance of 2026. This accumulation reversed sharply this week. On May 13, single-day net outflows reached $635 million—the largest daily decline of the week; on May 15, none of the 11 bitcoin ETFs recorded positive inflows, with an additional $290 million flowing out.
Ethereum spot ETFs suffered five consecutive days of outflows, posting $255 million in net outflows for the week. As of the weekend, bitcoin ETFs maintained cumulative net inflows of $58.34 billion, with total assets under management standing at ~$104.29 billion.
$657 Million Liquidated—89% Long Positions
As ETF funds fled, the derivatives market underwent a brutal long-position purge. Per Coinglass data, total crypto market liquidations hit $657 million within 24 hours—of which ~89% were long positions. According to bitcoin.com, $584 million came from long liquidations, and the Fear & Greed Index plunged from a neutral 50 just days earlier to 29—entering the “fear” zone.
Leverage-driven liquidation cascades accelerated the decline. After breaking key support levels, bitcoin triggered massive stop-loss and margin calls, fueling a downward spiral of “liquidation → selling → further liquidation.” Joel Kruger, Crypto Strategist at LMAX, described the process as “forced liquidations and position cleansing” pushing bitcoin below critical technical support levels.
Bitcoin is currently trading between $76,000 and $76,800. Its 50-day moving average (~$76,716) provides near-term support, while the 200-day moving average (~$83,513) acts as resistance above.
Strategy Buys 20,000 BTC Against the Tide; Saylor Ignores the Same Sentiment Reports
While retail investors faced liquidations and ETFs hemorrhaged capital, Strategy (formerly MicroStrategy) executed contrarian purchases during the same period.
According to an 8-K filing submitted to the SEC on May 18, Strategy acquired 24,869 bitcoins for ~$2.01 billion between May 11 and May 17, at an average price of $80,985. This transaction brings Strategy’s total holdings to 843,738 BTC, with a cumulative cost basis of ~$63.87 billion and an average acquisition price of ~$75,700. Funding for this purchase came primarily from the sale of STRC preferred shares.
Strategy also disclosed that its “BTC Return”—a metric measuring the growth of its bitcoin holdings relative to diluted share count—stood at 12.6% year-to-date in 2026.
This is not the first time Saylor has added during market panic. Throughout 2026, Strategy has maintained a near-weekly or biweekly purchasing cadence—regardless of market direction. From January to May, its holdings increased from ~560,000 BTC to over 840,000 BTC—an average monthly addition of nearly 60,000 BTC. In the very same week everyone watched PPI data and ETF outflows, he spent another $2 billion.
Goldman Sachs Fully Exits XRP & Solana ETFs in Q1—Keeps Only Bitcoin
If Strategy’s actions represent the stance of “bitcoin maximalists,” Goldman Sachs’ Q1 2026 13F filing reflects a more broadly representative institutional choice.
Per Goldman Sachs’ latest Q1 2026 13F report, the firm fully exited all XRP- and Solana-related ETF positions during the quarter. At the end of the prior quarter, Goldman held ~$154 million in XRP-related ETFs (across issuers including Bitwise, Franklin Templeton, Grayscale, and 21Shares) and over $100 million in Solana-related ETFs—both positions now reduced to zero.
Ethereum ETF exposure was cut by ~70%, declining to ~$114 million. Bitcoin ETF holdings remained largely unchanged at ~$700–720 million, with only a modest ~10% reduction.
At the same time, Goldman Sachs increased its stakes in crypto infrastructure stocks: Circle holdings rose 249%, Galaxy Digital increased 205%, and Coinbase was also added to. This set of moves sends a clear signal: Goldman hasn’t exited crypto—it’s narrowing its bets, shifting from “broad exposure” 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 its Ethereum ETF positions. Institutions are collectively consolidating their crypto exposures around a single asset class.
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