Bitcoin Bullish Signal: Whales Are Building Their Positions On Derivatives

Keshav Verma

Last Updated: June 11, 2024 6:56 am

3 mins read

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On-chain data shows whales are sending their Bitcoin from spot exchanges to derivatives, indicating that they are building up their positions.

Bitcoin Whales Build Up Their Positions On Derivative Exchanges

As pointed out by a CryptoQuant post, Bitcoin whales seem to be moving their crypto from spot exchanges to derivative exchanges.

The relevant indicator here is the “all exchanges to derivative exchanges flow mean,” which shows the total amount of coins being transferred from spot exchanges to derivative exchanges.

When the value of this metric shows continuous high values, it means a lot of Bitcoin is being regularly moved to these derivative exchanges, which may hint that whale activity has been going on.

Low values would imply not many coins are moving in this direction, and could either be staying still, or be rather going the opposite way: from derivatives to spot.

Now, here is a chart that shows the trend that this indicator has followed over the last couple of years:

The BTC all exchanges to derivatives flow mean vs the price | Source: CryptoQuant

The above graph has different regions marked based on whether whales seemed to be accumulating at that time or not.

The green regions were when the price was mostly moving sideways and the indicator had the whales sending a lot of BTC to derivatives.

Following these periods of accumulation, the price had always shown a jump up during the period of the above chart.

However, once the indicator’s value became very low, BTC’s price has seemed to have made a top after which its value dipped down.

Now, as is apparent in 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 the future price.

BTC Price

At the time of writing, Bitcoin’s price floats around $61.5k, up 2.7% in the last seven days. Over the past month, the crypto has accumulated 42% in gains.

The below chart shows the trend in the price of the coin over the last five days:

BTC's price seems to be rapidly plunging down | Source: BTCUSD on TradingView

After setting a new all-time high (ATH) of $67k, Bitcoin has been sharply going back down in the past couple of days. It’s unclear at the moment which trajectory the coin might follow next, but if the spot to derivatives flow mean is anything to consider, whales seem to be accumulating. This could help the price bounce back up and set it up to reach higher ATHs.

Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

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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