Unexpectedly high inflation data in the U.S. increased pressure on the crypto market and forced traders to reduce risky positions. Following the release of macroeconomic statistics, open interest on the largest crypto exchanges fell by nearly $1.25 billion, and Bitcoin dropped below the $80,000 mark.
Weak CPI data led to a reduction in risks in Bitcoin derivatives. Open interest (OI) on major crypto exchanges decreased by nearly $1.25 billion, noted CryptoQuant contributor Amr Taha, as reported by forklog.
According to the analyst, rising inflation forced investors to close positions, avoid opening new ones, and reduce leverage.
The decline was observed simultaneously on several major derivatives trading platforms — Binance, Gate.io, Bybit, and OKX. This indicates a broader decrease in short-term risks in the Bitcoin futures market, Taha believes.
"Inflation exceeding expectations can put pressure on risk assets as it undermines the narrative of a more accommodative monetary policy and pushes traders towards a cautious strategy," the expert explained.
The analyst clarified that in the current context, the decline in OI may reflect a short-term reaction from traders rather than a clear long-term bearish signal:
"When a significant drop in open interest occurs on several crypto exchanges following a macroeconomic catalyst, it often indicates a rapid adaptation of traders to new risk conditions."
State of the Crypto Market
After the CPI data was released, Bitcoin dropped from $81,000 to the current $79,000 — a decrease of 2.5%.
On May 13, the U.S. also published the Core Producer Price Index (Core PPI). The annual figure, like inflation, turned out to be higher than expected — 5.2% versus the anticipated 4.3%.
In March, the Core PPI was 4%. The latest value is the highest since 2022.
The index reflects changes in prices for goods and services, excluding volatile categories such as food and energy.
Along with another negative macro factor, CryptoQuant noted an increase in unrealized profits for Bitcoin traders. The average figure reached 17.7%.
"The last time margins reached such levels was in March 2022 when Bitcoin was testing the 200-day moving average just before resuming its downward trend," analysts warned.
Recall that MN Trading founder Michaël van de Poppe believes that there are no obvious reasons for Bitcoin to fall. According to him, there is a false perception in the market about the formation of a "bear flag" and a move towards $50,000 by the end of the year.
Analysts note that the cryptocurrency market remains highly sensitive to U.S. macroeconomic statistics and expectations regarding the Federal Reserve's monetary policy. Rising inflation heightens investors' concerns about maintaining high rates, which puts pressure on risk assets, including Bitcoin. Meanwhile, some experts consider the current correction to be a short-term market reaction rather than the beginning of a new large-scale decline.
