On-chain data shows Bitcoin inflows are trending up, a sign that whales might be increasing their dumping. This could prove to be bearish for the coin.
Bitcoin Inflows Move Up As Whales Continue To Sell
As pointed out by a CryptoQuant post, on-chain data highlights that BTC inflows to exchanges have been going up.
The “all exchanges inflow” is an indicator that shows the amount of Bitcoin that holders are depositing to exchanges on a given day.
When the value of this metric moves up, it means more investors are sending their coins to exchanges. Holders usually deposit their BTC for withdrawing to fiat or for purchasing altcoins. So, this could be a sign of dumping, and may be bearish for the price.
On the other hand, when the inflows decrease in value, it implies not many investors are depositing their Bitcoin to exchanges. Such a trend may mean that holders aren’t interested in selling at the moment.
Now, here is a chart that shows the trend in the value of the BTC inflows over the past few months:
Looks like the indicator's value has been trending up recently | Source: CryptoQuant
As the above graph highlights, BTC inflows have been on the rise lately. Before the crash in early December, the total inflows showed a sharp spike.
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Following the crash, the indictor calmed briefly before observing big spikes again. This may show that selling in the market might still be continuing.
The above chart also has curves for two other indicators, the top ten whale inflows and the total inflow seven days mean. The latter, as its name already suggests, is just the seven days mean value of the normal metric.
While the former is a metric that shows how the top ten whale inflows contribute to the total inflows. Examining the graph, it seems like this indicator also had a spike recently, showing that whales might be increasing their dumping.
Such a trend has usually been bearish for the price of the cryptocurrency. However, it hasn’t always been the case. But given the recent market environment, signs may not be in BTC’s favor.
At the time of writing, Bitcoin’s price floats around $49.1k, down 13% in the last seven days. Over the past month, the crypto has lost 27% in gains.
The below chart shows the trend in the price of BTC over the last five days.
BTC's price looks to be moving sideways again | Source: BTCUSD on TradingView
Since the crash, Bitcoin has mostly been in consolidation. Currently, it’s unclear when the coin might show some recovery.
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com