What Bitcoin whales and Binance have in common should worry investors
Bitcoin [BTC] whales seemed to have decided to demote other stablecoins with their current preference for the Binance stablecoin, BUSD.
In accordance Mignoleta CryptoQuant analyst, on September 27 the cryptocurrency exchange experienced its highest trading volume since June.
According to the analyst, this was due to increased whale activity. Accordingly, another noticeable aspect was that the increased trading volume was accompanied by a preference for BUSD by the same whales.
Source: CryptoQuant
What else happens on stock exchanges?
While Mignolet noted that the influx did not lead to withdrawals, some other movements were seen in overall exchange activity. Based on data from the analysis platform Glassnode, cumulative withdrawals increased more than usual in recent days.
Furthermore, the platform showed that while there were 36,154 transfers on September 25, investors’ withdrawal figures were 55,726 at press time. The implications could mean that many investors were not enthusiastic about a recovery of the crypto market.
Source: Glassnode
Furthermore, considering the inflow portion, the number of deposits was nowhere near the outgoing transfers. Despite recording over 22,000 deposits two weeks back, the average exchange inflow had reduced to 19,429.
With today’s indications, it could mean that Binance was the only exchange to experience such an increase. However, only BTC purchased with BUSD seemed to receive massive inflows. New reports from Glassnode showed that the seven-day outflow volume of BUSD was at a record high of 4,840,318,404.
📈 $BUSD Exchange Outflow Volume (7d MA) just hit a 1-month high of 4,840,318,404 BUSD
The previous 1-month high of 4,476,046,472 BUSD was observed on September 18, 2022
See calculation: pic.twitter.com/6idqszf8Jt
— glassnode alerts (@glassnodealerts) 29 September 2022
The derivatives market is not left out
In another CryptoQuant update, BTC reserves in the derivatives market had increased. This was observed by MAC_Danother analyst on the chain’s data platform.
MAC_D noted that the increase would also lead to increased derivatives trading. However, there were indications that the BTC price fell or rose depending on what happens in the derivatives market. The analyst also said,
“If the BTC reserve of the derivatives exchange is greater than the BTC reserve of the spot exchange, it has been shown that the price falls when the BTC reserve of the derivatives exchange increases further. Therefore, if the size of the BTC reserve of derivatives exchanges decreases, there is a possibility that BTC will rise again.”
In addition, a look at data from Coinglass revealed that there had been increasing liquidations in the futures market. The information platform for cryptocurrency futures also showed that over $31 million had liquidated in the last 24 hours.
With the BTC price above $19,000, several traders with short positions had suffered the liquidations with $14.32 million compared to $6.49 million longs.
Source: Coinglass
In light of these updates, it may be in investors’ best interest to dampen thoughts of a long BTC rally. But knowing that a switch to assess greens can also be a possible outcome.
