Cryptocurrency exchanges

Bitcoin reserves on exchanges continue climbing amidst rising inflows, is this a sell signal?

  • Bitcoin exchange inflow volume hit a three-month high of 2,237 BTC.
  • BTC reserves on exchanges continue to increase as part of the Bitcoin liquidity absorbed by Coinbase gets redistributed.
  • Analysts believe that macroeconomic scenario and risk aversion of market participants could increase selling pressure on Bitcoin.

Bitcoin exchange inflow hit a three-month high, indicating a rise of BTC reserves on cryptocurrency exchange platforms. Typically, a spike in BTC reserves is considered indicative of rising selling pressure on the asset.

Also read: Will Bitcoin emerge as a safe haven with new found divergence between BTC price action and equities?

Bitcoin on-chain metrics indicate increase in selling pressure on BTC

Bitcoin inflow to cryptocurrency exchange platforms has climbed consistently over the past week. Based on data from crypto intelligence tracker Glassnode, BTC exchange inflow hit a three-month peak of 2,237 Bitcoin.

BTC exchange inflow volume (hourly chart, 7d MA)

BTC Exchange Inflow Volume (Hourly Chart, 7d MA)

The rise in inflow of Bitcoin to exchange platforms is typically considered a bearish sign. A higher volume of BTC held in exchange wallets implies there is a higher volume of the asset available for sale, increasing selling pressure and negatively influencing the cryptocurrency’s price.

Interestingly, rising exchange inflow has translated into increased BTC reserves on exchanges, except for Coinbase. It’s important to note that the institutional activity on Coinbase was one of the main catalysts for the $25,000 breakout.

On March 11 and 12, institutional investors engaged in mass Bitcoin purchases on Coinbase. Part of the absorbed BTC is now being withdrawn from the exchange and redistributed.

Bitcoin exchange reserves

Bitcoin exchange reserves

Analysts at CryptoQuant believe it is possible that the redistributed BTC is being sold, due to the macro scenario of risk aversion and a drop in market liquidity as a whole.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Bitcoin exchange inflow hit a three-month high, indicating a rise of BTC reserves on cryptocurrency exchange platforms. Typically, a spike in BTC reserves is considered indicative of rising selling pressure on the asset.


Cryptocurrency exchangesOne of the biggest stories in the Ripple community: Coinbase to relist XRP, but there’s a catch
Cryptocurrency exchangesGridex Protocol's Native Token, GDX, Surges by Over 422% in 24 Hours After Listing on D5 Exchange

Similar Posts

Leave a Reply