The inflows to the Bitcoin Whale exchange have been declining since hitting a peak some time back. This could be a positive sign for the cryptocurrency’s price.
Bitcoin Whales Aren’t Sending Many Coins To Exchanges Right Now
In a CryptoQuant blog post, an analyst noted that BTC’s inflows hit a new high and have declined since. It is possible the low point may signal the end of the coin’s decline.
The “all exchanges inflow” is an indicator that measures the total amount of Bitcoin being transferred to wallets of all centralized exchanges.
This metric indicates that there are a lot more deposits being made to exchanges when its value is higher than it normally would. Investors often send coins to exchanges in order to sell them. This can make the BTC price bearish.
Low inflow values, on the other hand could indicate that there is a lot of selling going on right now. The trend may be bullish or neutral depending on how the outflows, the opposite metric, are rising or falling.
This chart shows how Bitcoin exchanges have been performing over the past few years.
Source: CryptoQuant| Source: CryptoQuant
The graph above shows that Bitcoin inflows reached a peak some time back. After which, crypto dropped below $18k.
The chart also includes the data for two other indicators, the “top 10 whale inflows” and the 7-day average of the total inflows.
First, the sum of all ten largest deposits to an exchange. The majority of these transfers come from whales so this indicator can give us an indication about the selling behaviour of large holders.
Both the inflows of whales and the average 7-day total inflows seem to have followed a similar trend in the past weeks.
Inflow spikes that are followed by low prices have been historically a sign of bottom formations in crypto.
As whales, and other investors as well, aren’t putting too much selling pressure on the market right now, it’s possible that Bitcoin may see a bullish outcome in the coming future.
BTC Prices
At the time of writing, Bitcoin’s price floats around $23.2k, down 5% in the past week.
It seems like crypto's value has been steadily increasing in recent months. Source: CryptoQuant| Source: CryptoQuant
Sandra Seitamaa's featured image on Unsplash.com. Charts from TradingView.com and CryptoQuant.com.