On-chain data shows that whales are sending their bitcoins to derivatives from spot exchanges, suggesting they are building their positions.
Bitcoin whales build their positions on futures exchanges
As mentioned in a CryptoQuant post, Bitcoin whales appear to be shifting their cryptos from spot exchanges to derivatives exchanges.
The relevant indicator here is the “flow average of all exchanges to derivatives exchanges”, which shows the total amount of coins that are transferred from cash exchanges to derivatives exchanges.
If the value of this metric is consistently high, it means that a lot of bitcoins are being moved to these derivatives exchanges on a regular basis, which may indicate that whale activity is ongoing.
Low values would mean that not many coins are moving in this direction and could either stay silent or rather go the opposite way: from derivatives to spot.
Now here is a chart showing the trend this indicator has been following over the past few years:
The BTC all exchanges to derivatives flow mean vs the price | Source: CryptoQuant
In the graphic above, different regions are marked depending on whether or not whales seemed to be gathering at the time.
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The green regions were when the price was mainly moving sideways and the indicator caused the whales to send a lot of BTC in derivatives.
After these accumulation periods the price had always shown a jump up during the period of the above chart.
However, when the value of the indicator got very low, the price of BTC appeared to have peaked, after which its value went down.
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Well, as you can see from the graph, the current trend makes it look like whales have just started another phase of accumulation. This could turn out to be bullish for future price.
At the time of writing, Bitcoin’s price is hovering around $ 61.5,000, up 2.7% over the past seven days. In the past month, crypto has accumulated 42% in profits.
The following graph shows the price development of the coin over the last five days:
BTC's price seems to be rapidly plunging down | Source: BTCUSD on TradingView
After reaching a new all-time high (ATH) of USD 67,000, Bitcoin has fallen sharply again in the past few days. It is unclear at the moment which trajectory the coin might follow next, but when the derivative flow mean point is taken into account, whales appear to be piling up. This could help the price go up again and reach higher ATHs.
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com