Traders Withdraw $800 Million in Bitcoin from Exchanges
A total of $800 million worth of BTC was removed from exchanges in response to the first cryptocurrency’s unexpected price surge, which is now trading far over $40,000.
The unexpected price surge came as a surprise in a market saturated with on-chain and fundamental data indicating the continued demise of digital gold, which has failed to rebound several times.
However, despite the majority gambled on the bull market coming to an end and a further decline below $30,000, centralised exchanges were consistently losing reserves, indicating that traders are not aggressively selling as the majority believed.
The first encouraging indicator for the sector was the “decoupling” of the majority of cryptocurrencies on exchanges from the stock market, which plummeted while Bitcoin and other digital assets traded in the neutral or positive territory.
What effect do currency outflows have on the market?
Generally, negative exchange flow is seen as a positive indication for the market, since selling pressure is far lower during times of substantial outflows than during periods when traders and investors aggressively move their money to centralised or decentralised exchanges.
Given that current BTC exchange flows remain negative, we may assume that the bulk of the market is not planning to liquidate its holdings despite Bitcoin’s recent decline.
At the time of publication, Bitcoin is trading at $41,725 against a local high of $41,983. The cryptocurrency continues to have a solid trading day, now trading at 0.72 percent. Previously, Bitcoin saw a 12-percent increase in a single day, rocketing from $37,100 to $41,700 in a couple of hours.