A sell-off of Bitcoin (BTC) and an associated drop in prices will “not happen,” said a well-known CEO of a well-known analysis tool.
In a tweet on October 12, CryptoQuant CEO Ki Young Ju noted that average inflows to the exchanges remained low despite BTC price hikes.
Ki: alternating currents “still in the safe zone”
Ki highlighted CryptoQuant’s average exchange rate inflow metric, which comfortably stays in the low risk area, suggesting a low likelihood of a sell-off.
The mean exchange inflow measures how much Bitcoin enters exchanges with the result that it could be used for sales or trading activities. In a broader sense, it gives an idea of whale activity – large-volume hodlers planning to part ways with BTC.
“$ BTC dumping will not happen,” commented Ki.
“The mean inflow of all exchanges usually indicates how many whales are active on exchanges. The danger zone is above 2 BTC and we are still in the safe zone. “
Hence, BTC / USD’s surge to nearly $ 11,500 this week didn’t add to the temptation for investors to sell.
Bitcoin cash inflows compared to the BTC / USD 1-month chart. Source: Ki Young Ju / Twitter
The lack of activity is in stark contrast to earlier this year. On March 9, a week before coronavirus caused a price crash between the assets, the exchange rate inflows passed the 2-BTC danger zone. Days later, around March 14th, the inflows peaked at almost 5 BTC. Bitcoin subsequently fell to $ 3,600.
What BitMEX Selling Pressure?
CryptoQuant also previously highlighted the streams of miners contributing to the Bitcoin price action. Last month, it was a surge in flows from mining basins, which were also believed to be for sale, which was accompanied by a 3% decline in BTC / USD.
In October, the situation was skewed with BitMEX withdrawals as the derivatives giant is currently under investigation by US tax authorities. According to CryptoQuant data, BitMEX outflows totaled 50,000 BTC on October 2nd alone.
BitMEX diagram for inflows and outflows. Source: CryptoQuant
The numbers from BitMEX, Cointelegraph and Digital Assets Data confirm that Bitcoin futures no longer have as much market share as they did in the past.
Bitcoin futures volume exchange comparison 1 month chart. Source: Cointelegraph / Digital Assets Data
As various analysts noted, Bitcoin largely weathered the storm caused by the platform’s problems, surpassing the resistance level of $ 11,000.
This resilience has encouraged the bitcoin bull case, Cointelegraph reported, and an increasing number of market participants are confident that more profits can be made before another downtrend.