Bullish Signal as 57,000 Bitcoin Leave Exchanges, a One-Year Record

July 31, 2021, 10:15 AM AEST - 1 month ago

Bitcoin exchange outflows, a key market indicator, have reached a one-year high providing an additional signal that bodes well for the apex predator of digital assets.

Exchange Outflows

Bybt and CryptoQuant shared data that showed the highest one-day outflow in at least a year. In 24 hours, 57,000 BTC – worth over US$2 billion – left exchanges.

Bitcoin Exchange Flows. Source: CryptoQuant

Bitcoin Archive was quick to chime in on the bullish news:

While no single market indicator should be considered as definitive evidence of a trend, the latest data reflecting massive Bitcoin outflows from exchanges has provided much cause for optimism.

Generally, large exchange outflows are indicative of investors taking their bitcoins “off market” and into cold storage. The reverse is true when exchange inflows are high. Note the precipitous drop in net transfer volume in Glassnode’s dataset below:

Bitcoin Exchange Outflows. Source: Glassnode

Bull Market Continues?

Bitcoin went sideways for months on end, leaving many investors questioning whether the bull run was over. Of late, however, the market sentiment appears to have shifted, at least as measured by the Bitcoin Fear and Greed Index:

There have been a number of promising market indicators in the past month suggesting that a sharp rise may be around the corner. From the reduction in leveraged shorts to growing evidence of a supply squeeze, Bitcoin bears appear to be on the back foot, at least for now.

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