Bitcoin breaks $30,000 as whales show outflow activity
Bitcoin has broken above the $30,000 mark as on-chain data shows whales have had some big outflows over the past 24 hours.
Bitcoin whales have made huge exchanges today
According to data from the analysis company at the chain Sentiment, 11 large BTC outflows were made from exchanges today. The relevant indicator here is the “exchange flow balance”, which measures the net amount of Bitcoin entering or exiting the wallets of all centralized exchanges.
When the value of this metric is positive, it means that a net number of coins are being transferred to these platforms right now. Since one of the main reasons investors use stock markets is for selling purposes, this type of trend can have bearish implications for the price.
On the other hand, negative values of the indicator suggest that holders are withdrawing part of the cryptocurrency from exchanges at the moment. Such a trend could be a sign of accumulation by investors.
Now, here’s a chart showing the trend in Bitcoin exchange flow balance over the last day or so:
Looks like the metric has seen some highly negative values recently | Source: Santiment on Twitter
As shown in the graph above, the Bitcoin exchange flow balance has observed large negative peaks in the last 24 hours. The largest of these spikes came from eight transactions of 2,000 BTC each occurring simultaneously.
Three more simultaneous transfers of 2000 BTC each took place one hour after this eight transaction group. This means that a total of 22,000 BTC (worth about $661 million currently) left exchanges with these outflows.
These sudden extremely large outflows may be a sign of large purchases by the whales. The timing could also suggest that this buying pressure could be driving the sharp bullish move that the cryptocurrency has seen today, where it has now broken above the $30,000 mark for the first time since June 2022.
Bitcoin trading volume data is also showing elevated levels, which may indicate that this price movement may be sustainable for now.
The indicator has sharply surged during the past day | Source: Santiment
The chart above also shows the data for the “active addresses”, a metric that measures the daily amount of unique addresses participating in transactional activity on the Bitcoin blockchain.
It appears that this metric has not shown any significant peaks over the past day, despite the sharp rise in price. This may be further evidence that the increase in price is driven by the large movements that a small number of whales have made today.
High participation by the average investor has historically followed long-term price movements, so while trading volume may be enough to fuel the rally for now, it is uncertain whether the move can stick if active addresses continue to remain low.
BTC price
At the time of writing, Bitcoin is trading around $30,000, up 6% in the last week.
BTC has shot up over the last few hours | Source: BTCUSD on TradingView
Featured image from Thomas Lipke at Unsplash.com, Charts from TradingView.com, Santiment.net
