Biggest Bitcoin exchange inflows since 2018 put potential $20K bottom at risk

189
SHARES
1.5k
VIEWS

Bitcoin (BTC) may be on the verge of a retail major sell-off as exchange flows reach nearly three-and-a-half-year highs.

Data from on-chain analytics platform Cryptoquant shows users from 21 major exchanges are sending coins to their wallets as of June 14.

READ ALSO

Major exchanges liquidate 83,000 BTC in a single day

Traders panicked as BTC/USD fell to a low of $20,800, and despite the reversal that was above $23,000 at one point, few were willing to believe that the worst was over.

Since then, spot price action has returned near $21,000, while 24-hour exchange flows have reached 59,376 BTC.

According to data from Cryptoquant, this is the largest daily inflow since November 30, 2018. On that day, exchanges recorded a net inflow of 83,481 BTC.

It ended with 29,082 BTC in net inflows for the platforms monitored by Cryptoquant on May 9, 2022.

Thus, the concern now is whether there will be even more selling pressure in the bitcoin markets in the coming days and weeks. Almost a month after the 2018 inflows, BTC/USD hit the bottom of its cycle at $3,100, 84% from its earlier high of $20,000.

bitcoin exchange netflow chart. Source: Cryptoquant

As Cointelegraph reported, analysts have mixed opinions on whether bitcoin will repeat this cycle. A drop of 84% would only mean a low of $11,000.

In a separate analysis of the price situation, statistician Willy Woo concluded that macro market movements will dictate bitcoin’s downside.

“I guess it’s simpler than this, IMO we’ll find the bottom when the macro market stabilizes,” part of a Twitter thread that looked at various price support theories. Reading,

FTX, Binance see particularly heavy selling

Meanwhile, the CEO of Cryptoquant, Ki Young Joo, pointed fingers at derivatives traders and the largest global exchange Binance, analyzing who is selling so far.

RELATED: ‘Too Quick’ To Say Bitcoin Price Reclaims Key Bear Market Support – Analysis

Key noted that the largest number of coins destroyed – inactive coins activated after a dormant period – came from specific locations.

“This selling pressure has come from Binance and FTX,” he wrote in a twitter thread June 13.

“$BTC exchange inflow CDD (coin destroyed day) points to older whale deposits. Binance’s inflow CDD reached a year-ago high before the fall.
Bitcoin coin days destroyed for Binance, FTX (screenshot). Source: Ki Young Joo/Twitter

Key said this was in contrast to other whales, which have been relatively calm during the price turmoil that began with May’s Terra Luna eruption.

Meanwhile, data from on-chain analytics resource Coinglass specifically shows the extent of downside on FTX in recent days.

Bitcoin funding rates for Binance, FTX. Source: Coinglass

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, so you should do your own research when making a decision.