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Breaking News: Coinbase Confirms DOJ Investigation Following Major Security Incident

Bitcoin Outflows Spike As 30k BTC Exits Exchanges, Reserve Plunges Down

Keshav Verma
Keshav Verma
3 years ago
3 mins read

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Bitcoin outflows have shown a spike amounting to 30k BTC today, leading to a plunge in the all exchanges reserve.

Bitcoin Netflow Shows Deep Negative Spike As 30k BTC Exits Exchanges

As pointed out by an analyst in a CryptoQuant post, the BTC exchange netflow showed a large negative spike earlier today.

The “outflow” is a measure of the total amount of Bitcoin exiting wallets of all exchanges. Similarly, the number of coins being deposited to exchanges is the “inflow.”

The difference between the inflow and the outflow is called the netflow. This indicator tells us the net amount of coins moving into or out of exchanges.

When the value of this indicator is negative, it means outflows are currently overwhelming the inflows and a net amount of Bitcoin is exiting exchanges. Such a trend, when prolonged, can be bullish for the price of the crypto as it may be a sign of accumulation.

Related Reading | USDC Inflow Spikes Up, Will It Act As Dry Powder For New Bitcoin Rally?

On the other hand, a positive netflow shows that a net amount of coins are entering exchange wallets at the moment. Since investors usually deposit to exchanges for selling purposes, this trend can be bearish for the coin.

Now, here is a chart that shows the trend in the Bitcoin netflow over the past couple of weeks:

Bitcoin Netflow

Looks like the indicator showed a large downward spike recently | Source: CryptoQuant

As you can see in the above graph, the Bitcoin netflow had a huge negative spike earlier today. This amounted to an outflow of more than 30k BTC, or over $1.2 billion.

Such a large amount of coins exiting exchanges has made the exchange reserve (a metric that measures the total number of BTC present on exchanges) plunge down:

Bitcoin Exchange Reserve

The indicator's value seems to have plummeted today | Source: CryptoQuant

If this outflow belongs to one or more whale entities withdrawing their Bitcoin for hodling in cold wallets, then it can be quite bullish for the price of the crypto as it has significantly reduced its sell supply (that is, the reserve).

Related Reading | Bitcoin On Course To Hit $100K Nine Months From Now, Bitbull CEO Predicts

However, as the quant notes, it’s yet unclear at the moment what this negative netflow may signify. It’s possible it could be just an internal transfer within the exchange wallets. And if so, it shouldn’t have any positive effect on the price.

BTC Price

At the time of writing, Bitcoin’s price floats around $40k, down 3% in the last seven days. Over the past month, the crypto has lost 6% in value.

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

Bitcoin Price Chart

BTC's price plunged down yesterday | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com
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Keshav Verma
Keshav Verma

Keshav Verma

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

Read more

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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Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
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