Binance USD (BUSD) Exchange Reserves Have Gone Down
As pointed out by an analyst in a CryptoQuant , there was a very large inflow of $250 million BUSD just a while ago. The “exchange reserve” is an indicator that measures the total amount of a cryptocurrency (which, in the present case, is Binance USD) currently being stored on wallets of centralized exchanges.
Generally, investors swap their coins for stablecoins like BUSD when they want to avoid the volatility associated with other cryptocurrencies like Bitcoin. When these holders feel that prices are right to reenter the volatile markets, they shift their stables back into their desired coins. This can act as buying pressure for the specific crypto that they are swapping into.
The value of the metric seems to have been going down in recent days | Source:As you can see in the above graph, the Binance USD exchange reserve observed a rapid increase a while back. Since then, however, the metric has been steadily declining and has hit significantly lower values now. But from the chart, it’s apparent that while the BUSD reserve was coming down from high values, Bitcoin had been rallying instead. This means that holders might have been actively swapping the stablecoin for BTC, thus providing a boost to its price.
The graph also displays data for a metric called the “exchange netflow,” which tells us the net number of coins entering or exiting exchange wallets. When this metric has a positive value, it means investors are depositing a net amount of the asset to exchanges currently, while negative values suggest net withdrawals are taking place.
BTC Price
At the time of writing, Bitcoin is trading around $20,700, up 14% in the last week.Bitcoin plunges down | Source: