Bitcoin Nears $43k, Indicators Suggest Bull Market Ahead

Keshav Verma

1 year ago

3 mins read

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The Bitcoin fund flow ratio for all exchanges is on a decline, while BTC transactions are rising. This could suggest a bull market is ahead.

Bitcoin Fund Flow Ratio For All Exchanges Goes Down

As pointed out by a CryptoQuant post, the BTC fund flow ratio for all exchanges seems to be on a downwards trend. Also, BTC transactions are going up.

The Bitcoin fund flow ratio is an indicator that’s defined as the total amount of BTC going into or out of exchanges divided by the total amount of BTC transferred on the whole network.

$Fund Flow Ratio = Total Exchange Inflows + Outflows in BTC$ ÷ $Total Transferred BTC (whole network)$

Basically, the indicator shows the percentage of BTC that’s involved in exchange-related transactions as compared to the total transactions on the entire network.

With the help of the fund flow ratio, it becomes possible to know what percentage of BTC transactions happen outside exchanges. That is, through methods like over-the-counter (OTC) deals or P2P transfers.

The other relevant metric here is the total tokens transferred. As the name suggests, this indicator shows the total number of BTC that has been transferred on the network in some form.

Now, here is a chart that shows the trend in both the BTC fund flow ratio and total tokens transferred:

The two Bitcoin indicators show bullish signals | Source: CryptoQuant

As the chart shows, the BTC fund flow seems to be going down, while the tokens transferred metric is going up.

What this means is that while exchanges getting fewer transactions usually signals low volatility, the total transactions are also going up across the board. This would suggest that OTC deals are shooting through the roof (and thus occupying a relatively higher percentage), rather than a drop in the volatility itself.

The combination of these indicators behaving like this is usually a bullish sign. During the August of last year, before the bull run started, similar signals were present.

Bitcoin Price

At the time of writing, BTC’s price is around $42.7k, up 9.5% in the last 7 days. Over the past month, the crypto has gained 23.5% in value.

Below is a chart that shows the trend in the price of the crypto over the last 3 months:

BTC's price shoots up | Source: BTCUSD on TradingView

Bitcoin seems to have caught a sharp uptrend as the crypto nears $43k. It’s unclear if BTC can continue the rally and go beyond this point, or whether it will crash again like at the start of the month. If the indicators discussed above are anything to go by, a bull run looks more likely at the moment.

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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