Bitcoin Faces 34,000 BTC Sell Pressure Amid Exchange Inflows
By John Nada·May 26, 2026·4 min read
Bitcoin faces nearly 34,000 BTC sell pressure due to exchange inflows. Institutional flows fail to absorb supply, reinforcing market risk-off phase.
Bitcoin is contending with intensified sell pressure as nearly 34,000 BTC have been influenced by recent market dynamics involving exchange inflows and exchange-traded funds (ETFs). This scenario underscores the need for fresh spot demand to effectively absorb the increasing supply. Axel Adler Jr., a Bitcoin researcher, highlighted that both exchange and ETF activities are displaying a local supply imbalance despite Bitcoin's recent price recoveries.
The imbalance can be observed in the weekly exchange netflows, which have increased by approximately 18,000 BTC. This surge indicates that more bitcoins were deposited into exchanges than withdrawn, thereby escalating the immediate selling supply. This influx of BTC into exchanges typically suggests that holders may be preparing to liquidate assets, contributing to downward pressure on the price unless offset by equivalent buying interest.
Simultaneously, spot BTC ETFs have recorded net outflows amounting to nearly 16,000 BTC, further complicating the market dynamics. The failure of institutional flows to absorb the excess supply has reinforced a risk-off phase within the market. This phase is characterized by investors moving away from riskier assets, such as Bitcoin, into safer investments.
Analyzing the data provided by Glassnode, cryptovizart noted a significant drop in daily ETF trading volume, which has plummeted from over $50 billion in late 2025 to below $20 billion. This sharp decline suggests a waning speculative demand through traditional financial channels and a weakened capacity for spot absorption during market rallies. The reduced trading activity can be viewed as a bellwether for shifting investor sentiment, where the enthusiasm for speculative trading is diminishing, potentially due to macroeconomic factors or a reevaluation of risk profiles.
Despite these pressures, Bitcoin managed a rebound, pushing its price towards the $77,800 mark after briefly dipping below the $75,000 threshold. This recovery coincided with an improvement in investor sentiment, largely driven by geopolitical developments such as reports of a potential peace deal between the US and Iran. Such news can alleviate broader market risk concerns, thereby boosting the appetite for risk assets like Bitcoin.
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In the derivatives market, data indicates that the recent price rally was predominantly driven by short covering. During this phase, aggregated Bitcoin open interest fell from nearly 268,000 BTC to approximately 250,000 BTC, before experiencing a slight recovery to 254,000 BTC. This trend suggests that bearish traders were exiting their positions, which is indicative of short covering activity as Bitcoin prices reclaimed a support level.
Rei Researcher observed that the daily funding rate has remained negative since February 2026. This indicates that short traders are continuing to pay long traders to maintain their positions, highlighting a dynamic where steady spot demand is effectively absorbing supply over higher time frames, despite persistent short-term pressures.
Further analysis from Glassnode revealed signs of cooling sell pressure. The price momentum weakened by 21.7% during a recent drop, while spot cumulative volume delta (CVD) and futures CVD surged by 77.2% and 35.5%, respectively. These metrics indicate that selling activity began to taper off as market positioning achieved a more balanced state.
For Bitcoin to build sustainable momentum toward the coveted $80,000 level, both open interest and spot demand will need to rise in conjunction with the price. This alignment is crucial to ensure that any upward price movements are supported by a solid foundation of genuine buying interest rather than speculative trading alone.
The current market scenario serves as a reminder of the complexities inherent in the cryptocurrency space, where factors such as geopolitical developments, institutional activity, and market sentiment can have profound impacts on asset prices. While the path forward may be fraught with challenges, the resilience of Bitcoin and its ability to recover from dips underscore its enduring appeal among investors seeking exposure to digital assets.