Crypto Sheds $90.3B in Under an Hour as Bitcoin Slips Below $78,000
The crypto market sold off sharply on May 16, with about $90.3 billion in value disappearing in less than an hour. Total market capitalization fell 3.37% to roughly $2.59 trillion.
Bitcoin dropped to $77,678. Major altcoins also declined, with Ethereum, XRP, Solana and Dogecoin down about 3.5% to 6%.
Macro data, not crypto-specific news, drove the move. U.S. inflation figures surprised to the upside: producer prices (PPI) came in about 6% above analyst expectations, the biggest miss since December 2022, after April CPI printed at 3.8%. The releases hit expectations for near-term Federal Reserve rate cuts. CME FedWatch pricing shifted to show more than a 44% probability of a rate hike by December, triggering fast risk-off positioning across equities and crypto.
Bitcoin's decline tracked weakness in small caps. The asset has recently moved closely with the iShares Russell 2000 ETF (IWM), and as small-cap stocks sold off, Bitcoin followed.
Flows also turned negative. U.S. spot Bitcoin ETFs recorded roughly $290 million of outflows on the day, snapping a six-week inflow streak. BlackRock's IBIT led the redemptions with about $136 million. For the week, spot Bitcoin ETF outflows totaled around $1.15 billion, according to SoSoValue.
Additional supply pressure emerged ahead of the drop. Analyst Ali Martinez said miners sold nearly 800 BTC (about $64 million) in the four days before the move. With macro-driven selling and ETF redemptions thinning demand, long positioning came under strain.
Derivatives accelerated the slide. CoinGlass data shows about 154,000 traders were liquidated over 24 hours, wiping roughly $696 million from derivatives positions. Bitcoin liquidations rose 125% to more than $235 million, while total crypto derivatives open interest fell over 25% as leveraged positions were unwound.
On the charts, trader Ted Pillows said Bitcoin broke below a long-standing ascending channel on the daily timeframe, with two consecutive red candles confirming the breakdown. He warned that failure to hold $78,000 could open a quick move toward $74,000–$75,000. Analysts said a sustained break could expose deeper support around $70,000–$68,000.
Altcoins underperformed in the broader risk-off move. XRP, Solana, BNB, Hyperliquid, Zcash, Dogecoin, Chainlink and Cardano all fell more than Bitcoin, consistent with prior selloffs tied to hawkish macro signals.
The episode reflected a macro-led deleveraging cycle: hotter inflation reset rate expectations, prompting equity and crypto outflows, while miner selling and ETF redemptions reduced liquidity. The combination left leveraged exposure vulnerable and prices moved lower in a hurry.
