The latest on-chain data suggests that Bitcoin whale inflows have been at the highest level ever, meaning that the recovery over $22k could not last.
Bitcoin’s Top 10 Exchange Inflows have risen in recent days
An analyst pointed out in a CryptoQuant posting that the whale deposit to crypto exchanges is at its highest point in the history.
The “all exchanges inflow” is an indicator that measures the total amount of Bitcoin currently entering into wallets of all centralized exchanges.
Specifically, the sum of the top 10 inflows represents the number of coins that have been deposited by BTC Whales.
If this metric has a high value, that means whales have large amounts of Bitcoin at the moment. Because investors typically transfer funds to exchanges for sale purposes, this trend can indicate whale dumping and could be bearish on the cryptocurrency’s value.
A low value for the metric means that whales are contributing a large amount of money to the exchanges. This trend could be bullish, neutral or both depending on whether there is any buying currently.
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Below is a chart to show the change in BTC Top 10 Inflows (21-day Moving Average) in recent years.
It appears that the indicator's value has increased in recent weeks. Source: CryptoQuant| Source: CryptoQuant
You can see that the MA Bitcoin top 10 inflow for the 21-day period has reached an all time high as you can see from the graph.
The current rate at which whales deposit to cryptocurrency exchanges is unprecedented in crypto history suggests this. The outcome of these whales selling their coins could mean bearish BTC. That would be a sign that the current rally to $22k might not last.
Similar reading: Bitcoin’s Rise to the Top in Transactions Worth $1 Million and More| Sleeping Giant Awakens, Bitcoin Sees Spike In Transactions Valued Above $1 Million
Quant also showed data on the BTC Volume in the same chart. It seems like the volume of the coin hasn’t been too high recently. The latest rally could have been driven by whale activity and not organic activity. This suggests that the current increase may have been short-lived.
BTC price
At the time of writing, Bitcoin’s price floats around $22k, up 11% in the past week. Below is a chart showing the change in crypto’s value over the past five days.
Source: tradingView.com/BTCUSD| Source: BTCUSD on TradingView
Featured image from Rémi Boudousquié on Unsplash.com, charts from TradingView.com, CryptoQuant.com