Bitcoin whales send BTC to futures exchanges in “classic” bottom signal

by · September 8, 2022

Bitcoin (BTC) whales are betting on a rally as fresh data shows ‘classic’ bottoming behavior.

According to on-chain analytics platform CryptoQuant, high-volume investors are moving coins to derivatives exchanges in droves this month.

Analyst: Whales protect in positions ‘forming a local bottom’

As BTC/USD hit its lowest levels since late June, whales reacted kindly.

In one of his Quicktake market updates published on September 7, CryptoQuant analyst Maartunn flagged a marked increase in the monthly average number of transactions made between spot exchanges and derivatives platforms.

Whales, Maartunn argued, hedge their losses and transfer funds for use in futures games.

“A typical thing for local bottoms is a top on the Exchanges to Derivative Exchanges Flow Mean (30d MA). And guess what, that’s happening right now,” he began.

The phenomenon was already underway before the latest BTC price drop.

On Ether (ETH), derivatives exchanges already saw increased inflows in the run-up to the Merge event set for next week. As such, the ETH markets are currently ahead of Bitcoin by almost three months, explains Maartunn.

“The assumption in this thesis is that whales will deposit Bitcoin on derivatives exchanges to open futures (long) positions and be able to protect their positions forming a local bottom,” the update concluded.

“Important thing to note: Ethereum has already led the market for 80 days, mainly driven by ‘The Merge’ hype. That hype will end later this month, which could have a significant impact on the crypto market. This could greatly involve observations like this.”

Bitcoin spot-to-derivatives exchange transactions annotated chart. Source: CryptoQuant

Big payouts continue

Meanwhile, separate observations by monitoring resource Whalemap focused on a potential sale of 5,000 BTC, which had previously been dormant since Christmas 2013.

Related: Bitcoin is a ‘wild card’ set to outperform – Bloomberg analyst

The move follows suspicions of several tranches of 5,000 BTC moving around the network after a nine-year hibernation in recent weeks.

Whalemap additionally reiterated key chain support levels in place based on the accumulation of large volumes in the past. These take the form of $19,000, $16,000 and $13,000.

“Prime time for $BTC,” the Whalemap team wrote comments when the June decline returned.

Bitcoin volume profile annotated chart. Source: Whalemap/Twitter

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