Bitcoin Netflow Shows Deep Negative Spike As 30k BTC Exits Exchanges
As pointed out by an analyst in a CryptoQuant , the BTC exchange netflow showed a large negative spike earlier today.The “outflow” is a measure of the total amount of Bitcoin exiting wallets of all exchanges. Similarly, the number of coins being deposited to exchanges is the “inflow.”
Related Reading | USDC Inflow Spikes Up, Will It Act As Dry Powder For New Bitcoin Rally?
Looks like the indicator showed a large downward spike recently | Source:As you can see in the above graph, the Bitcoin netflow had a huge negative spike earlier today. This amounted to an outflow of more than 30k BTC, or over $1.2 billion.
Such a large amount of coins exiting exchanges has made the exchange reserve (a metric that measures the total number of BTC present on exchanges) plunge down:
The indicator's value seems to have plummeted today | Source:If this outflow belongs to one or more whale entities withdrawing their Bitcoin for hodling in cold wallets, then it can be quite bullish for the price of the crypto as it has significantly reduced its sell supply (that is, the reserve).
Related Reading | Bitcoin On Course To Hit $100K Nine Months From Now, Bitbull CEO Predicts
However, as the quant notes, it’s yet unclear at the moment what this negative netflow may signify. It’s possible it could be just an internal transfer within the exchange wallets. And if so, it shouldn’t have any positive effect on the price.BTC Price
At the time of writing, Bitcoin’s price floats around $40k, down 3% in the last seven days. Over the past month, the crypto has lost 6% in value.
The below chart shows the trend in the price of the coin over the last five days.BTC's price plunged down yesterday | Source:
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com