Bitcoin Price Drop Attributed to Spot Selling, Not Futures Unwind

Crypto market analysts are pointing to a surge in spot selling as the primary cause of Bitcoin's recent price drop. Data from CryptoQuant reveals that between May 15 and May 17, spot volume on all exchanges contracted by 47.52%, while open interest only increased by 0.78%. This suggests that weak demand for Bitcoin in the spot market led to the price decrease.

The data also shows a significant influx of Bitcoin into exchanges during this period, with 49,577 BTC entering exchanges between May 15 and May 17. This is typically associated with potential selling pressure when it coincides with a price drop. The large flow of Bitcoin into exchanges suggests that large participants were actively selling their holdings.

Bitcoin's price dropped from $79,064.75 to $76,572.92 between May 15 and May 17, a decline of around 3.15%. However, if the price falls below $76,285, which is an appreciable daily support level, the next relevant area would be near $73,817, where another daily support sits.