Bitcoin (BTC) did not experience a dramatic drop in futures margin calls as its price reached a two-month low, according to analysis. Glassnode’s lead on-chain analyst, Checkmate, revealed a significant change in the Bitcoin bull market. While the price drop to $56,500 on May 1 may have surprised some, it is seen as a healthy correction for the market. Checkmate pointed out that there has been a gradual reduction in leverage across Bitcoin futures since the all-time highs in mid-March, signaling the end of excessive bullishness. Unlike in previous bull markets, funding rates in derivatives have cooled off gradually instead of experiencing a sudden drop, indicating that there was no massive futures margin call. The recent decline in Bitcoin’s price has been attributed to other factors, including significant outflows from US spot Bitcoin exchange-traded funds (ETFs). Investors reacted to the performance of BTC by withdrawing more than half a billion dollars from these ETFs. The largest outflow came from Fidelity Investments’ Fidelity Wise Origin Bitcoin Fund. This drop in Bitcoin’s price has created fear in the market, as reflected by the Crypto Fear & Greed Index, which has returned to neutral territory. This article does not provide investment advice and readers should conduct their own research before making any investment decisions.
Bitcoin sheds ‘excessive bull market residue’ with daily ETF outflows surpassing $500M