On-chain transaction data appears to show that cryptocurrency investors have withdrawn over 111,000 BTC from exchanges in the past 30 days, presumably to keep their funds long-term.
According to on-chain analyst Will Clemente, nearly $ 5 billion worth of BTC 111,033 left exchanges during this period, making it “one of the sharpest declines in exchange stocks in Bitcoin history.”
Clement’s words were backed up by data from on-chain analytics firm Glassnode, which also recently tweeted about outflows from Bitcoin exchanges. According to the company, bitcoin exchange flows “returned to an outflow dominance by August” as investors continued to withdraw BTC.
Bitcoin flowing from centralized trading platforms is often viewed as an optimistic sign as investors typically withdraw their funds to secure them in cold wallets or through other custody solutions. The funds can also be tokenized and used in decentralized financial services (DeFi).
On the flip side, with large foreign exchange inflows, investors prepare for a market downturn, as it could mean big sell-offs are imminent.
# Bitcoin exchange flows have returned to outflow dominance by August as investors withdraw $ BTC.
The market has gone through a number of phases of dominance of foreign exchange flows over the past year, with the dominance of outflows last seen in late 2020. pic.twitter.com/BQLlw06SJr
– glassnode (@glassnode) August 19, 2021
Bitcoin exchange outflows may have increased recently due to a recent drop in prices. According to CryptoCompare data, the cryptocurrency fell from around $ 48,000 to a low of $ 44,000 before apparently recovering.
The price coincided with a move from stablecoins worth more than $ 222 million to centralized cryptocurrency trading platforms, according to on-chain analytics firm Cryptouant. The large inflows, according to CryptoQuant, are often increasing and are typical of “whales and / or institutional units waiting in the shade to benefit from local break-ins”.
Bitcoin whales have apparently amassed billions in BTC I since the flagship cryptocurrency fell from its all-time high of nearly $ 64,000 to a low of $ 30,000 before recovering. In this context, whales are defined as clusters of addresses belonging to an entity with between 1,000 and 10,000 BTC.
These moves seem to suggest that whales will see Bitcoin as an option to buy if the price of the cryptocurrency stays below the $ 45,000 mark. Reports from institutional investment managers suggest that the demand remains on their part as well.
As reported, four companies recently announced that they had increased their exposure to the flagship cryptocurrency Bitcoin by purchasing a total of 250,204 shares in the Grayscale Bitcoin Trust (GBTC).
The views and opinions of the author or any other person mentioned in this article are for informational purposes only and do not constitute financial, investment or other advice. Investing in or trading in crypto assets carries the risk of financial loss.
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