Why did my friendship end over a misunderstanding?

I recently lost a friendship after a misunderstanding and I’ve been trying to understand my part in what happened instead of simply blaming the other person.
It started when I thought my friend was going through a difficult time emotionally. Instead of asking her what she needed I made an assumption that she probably wanted some space so I avoided her because I genuinely thought I was respecting her boundaries.
When she eventually confronted me about it I apologized and explained why I had pulled away. What I was trying to say was essentially:
"I’m really sorry for avoiding you today. I thought you were having a difficult time so I wanted to give you some space."
At the time I genuinely meant that as an act of consideration. I wasn’t trying to punish her reject her or make a passive-aggressive comment.
After that though she became increasingly distant. We eventually went months barely speaking and I recently found out that she blocked me.
Looking back I can understand how saying "I wanted to give you space" might have sounded very different to someone who was already hurt. She may have interpreted it as me saying I didn’t want to be around her or that I was pulling away because she had done something wrong.
I also realize that my biggest mistake may have been assuming what she needed instead of simply asking her.
What I’m struggling with is how something that started as a misunderstanding eventually led to the friendship ending. I understand that my actions may have hurt her but I’m having a hard time understanding whether what I did was really that serious.
I’d genuinely appreciate some outside perspectives.
Was what I said actually hurtful or could it have come across as passive-aggressive?
If a friend gave you that explanation how would you interpret it?
Was giving her space without asking what she wanted a serious mistake?
What could I have done differently?
And is there something I should learn from this so I don’t repeat the same mistake in future friendships?
I genuinely want to understand what I did wrong what I didn’t do wrong and how I could handle a similar situation better in the future.