Bitcoin Bullish Signal: $900 Million In BTC Leaves Exchanges

Source Newsbtc

On-chain data shows the exchanges have witnessed net Bitcoin outflows through the latest volatility, a sign that could be positive for BTC’s price.

Bitcoin Exchange Netflow Has Been Negative Recently

According to data from the market intelligence platform IntoTheBlock, Bitcoin has been leaving exchanges recently. The on-chain metric of relevance here is the “Exchange Netflow,” which measures the net amount of BTC entering into or exiting out of the wallets associated with all centralized exchanges.

When the value of the indicator is positive, it means the investors are making net deposits of the cryptocurrency into these platforms. As one of the main reasons why holders transfer their tokens to exchanges is for selling-related purposes, this kind of trend can have a bearish impact on the BTC price.

On the other hand, the metric being under the zero mark suggests the outflows are overwhelming the inflows. Generally, investors take their coins off into self-custody when they plan to hold into the long term, so such a trend can prove to be bullish for the asset.

Now, here is a chart that shows the trend in the Bitcoin Exchange Netflow over the past week or so:

Bitcoin Exchange Netflow

As is visible in the above graph, the Bitcoin Exchange Netflow saw a spike into the positive region on the 27th of last month, but the metric has since remained in the negative region.

This trend has maintained despite the fact that the asset has been observing volatility in both directions recently. Thus, it would appear that the investors are still bullish on the cryptocurrency.

“Despite the recent market fear, traders have shown conviction in BTC, withdrawing nearly $900 million worth of Bitcoin from exchanges in the past 7 days,” notes the analytics firm.

While exchange inflows can be bearish when it comes to volatile assets like BTC, the same doesn’t hold true in the case of stablecoins, digital assets that have their value tied to fiat.

Usually, investors who hold these coins eventually plan to invest into the volatile side of the market. Once they feel the time has come, they deposit into the exchanges to swap to the tokens of their choice, thus providing a buying pressure to their prices.

As such, an increase in stablecoin inflows can be a positive sign for Bitcoin and other cryptocurrencies. This trend has recently been developing in the sector, as an analyst has pointed out in a CryptoQuant Quicktake post.

Stablecoins Exchange Reserve

As displayed in the above chart, the Binance Stablecoin Exchange Reserve, a metric that keeps track of the total amount of these fiat-tied tokens sitting in the wallets of the Binance platform, has jumped to a new all-time high (ATH) recently.

BTC Price

Bitcoin has been unable to sustain recovery as its price has once again dipped to $88,600.

Bitcoin Price Chart
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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