Recent analysis of the data recorded on the blockchain reveals a surge in Bitcoin deposits to Coinbase, which may hint at an impending bearish trend for the cryptocurrency market.
Recent analysis of Bitcoin transactions on the blockchain reveals that there has been an increase in the amount of BTC being sent to Coinbase, which may imply an impending bearish trend for the cryptocurrency.
Spike in the amount of Bitcoin being deposited into Coinbase
Recently, there has been a notable spike in the amount of Bitcoin being deposited into Coinbase, an online cryptocurrency trading platform.
An analyst who posted on CryptoQuant recently observed that there had been an aggregate of 20k BTC moved to Coinbase. The “exchange inflows” is a benchmark that evaluates the whole amount of Bitcoin being sent to an exchange (in this example, Coinbase).
When the specified metric is elevated, a great deal of coins are transferred to the exchange by investors. Since exchanging coins on the market is often done for the intention of selling, this tendency could lead to negative effects on the price of the cryptocurrency.
On the contrary, if the values are low, it implies that investors are not depositing a considerable amount to the exchange. This could possibly be interpreted as either bullish or neutral for BTC; however, this will be determined by whether the overall inflows are declining or not.
Here is a graph that displays the pattern of Bitcoin deposits to Coinbase’s crypto trading platform over the last few months.
It appears the magnitude of the data has been considerable on multiple occasions in the past few days | Source: CryptoQuant
As depicted in the graph, considerable rises of Bitcoin exchanges to Coinbase have been observed in recent weeks. Nevertheless, it is evident that there were no noteworthy changes in price after any of these large deposits.
Given that the individual spikes were not that large, it is plausible to assume that the investors who conducted the transfers disposed of their coins once the transactions were finalized, thereby not contributing to any considerable fluctuations in the market.
Nevertheless, the expert in mathematics points out that a different situation may take place. Could it be that the owners of these inflows haven’t sold yet? It is not an uncommon occurrence for investors to deposit their coins to trading platforms in anticipation of the ideal market fluctuations in order to make their exit.
Altogether, approximately 20,000 BTC were put into Coinbase’s wallets. According to the present rate of exchange, this large total is worth about $336 million, which could certainly cause a shake-up in the cryptocurrency’s cost if it was all sold simultaneously.
The analyst warned that if the item has not been sold yet, one should be mindful, as the circumstances would be different if it had been sold immediately after the down payment.
The cost of Bitcoin (BTC)
As of the present, the value of Bitcoin is about $16,805, increasing by 0.86% since market open.
The BTCUSD pair is being monitored on TradingView.
