Is Bitcoin Rise Above $20k Sustainable? Here’s What On-Chain Data Says

Keshav Verma

2 years ago

3 mins read

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Bitcoin is now back above the $20k mark after observing some sharp uptrend over the past day, but is this pump sustainable? Here’s what on-chain data has to say about it.

Bitcoin All Exchanges Netflows Remain Muted Following The Price Rise

As explained by an analyst in a CryptoQuant post, the BTC exchange netflows can help us know whether this short-term uptrend is sustainable or not.

The “all exchanges netflow” is an indicator that measures the net amount of Bitcoin entering or exiting wallets of all centralized exchanges. The metric’s value is simply calculated by taking the difference between the inflows and the outflows.

When the indicator has a positive value, it means investors are depositing a net number of coins to exchanges right now. Since these holders may be sending the BTC to exchanges for selling purposes, this kind of trend could have bearish implications on the price of the crypto.

On the other hand, negative values of the netflow imply the outflows are currently overwhelming the inflows. Such a trend, when prolonged, can be bullish for the coin as it may be a sign of accumulation from holders.

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

Looks like the value of the metric saw a spike about a week ago| Source: CryptoQuant

As you can see in the above graph, only the positive scale of the Bitcoin exchange netflow is displayed, as it’s a sufficient enough metric in the context of the current price discussion.

It seems like there have been no significant spikes in the value of the indicator since the crypto has observed the pump. This means that whales haven’t deposited any coins for dumping yet.

Just a week or so back, there was a pretty large positive netflow spike, shortly after which BTC returned back from its small rise.

For now, Bitcoin hasn’t seen any such inflows, which would suggest the rise could continue in the short term. However, it remains to be seen how long the whales will keep sitting still.

BTC Price

At the time of writing, Bitcoin’s price floats around $20.5k, up 7% in the last seven days. Over the past month, the crypto has gained 9% in value.

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

The value of the crypto seems to have sharply risen up over the past 24 hours | Source: BTCUSD on TradingView

Featured image from Jievani Weerasinghe on 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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