Key trends identified in previous articles in the volatile Bitcoin market situation over the past year include: crypto slate The analysis reveals: Bitcoin exchange withdrawals have increased sharply since November 2022. According to Glassnode, this trend has accelerated since April 2023, resulting in over 100,000 BTC being withdrawn from exchange balances since April 18.
Understanding Bitcoin balances on exchanges is very important in gauging market sentiment. A rise in deposits usually signals a possible downturn as investors move bitcoin to exchanges to liquidate. Conversely, an increase in withdrawals often signals bullish sentiment as investors move bitcoin off exchanges to hold or use it, reducing the supply available for trading.
Since mid-May 2023, the rate of Bitcoin withdrawals from exchanges has exceeded the rate of deposits. His 30-day change in the amount of supply held in exchange wallets shows that the amount of BTC has decreased by 51,903 BTC. In other words, he withdrew 51,903 more Bitcoins from the exchange than he deposited during this period. This is a major shift and marks a strong trend for Bitcoin to flow out of exchanges.
The rapid pace of withdrawals and the lack of new deposits could amplify buying pressure on Bitcoin.
This is evident when analyzing currency trading volume momentum, a measure that compares monthly and annual averages of combined currency inflows and outflows.
If the monthly average exceeds the annual average, it indicates an increase in exchange-related on-chain activity, which is a sign of increased investor interest in Bitcoin and increased network usage. Conversely, a high annual average indicates a decline in exchange-related on-chain activity, indicating lower investor interest and lower network utilization. .
As of June 12, currency-related monthly trading volumes exceeded annual averages and continued to increase throughout July. This suggests increased investor interest and network usage, which, combined with the aforementioned withdrawal trend, could increase buying pressure on Bitcoin.
Post-Bitcoin buying pressure could surge amid rising exchange withdrawals, first appearing on CryptoSlate.
