A Signal Very Similar to Those Seen in 2020 Has Been Observed in Bitcoin: It Could Favor the Bulls

Cryptocurrency analytics company CryptoQuant has published a noteworthy assessment of the Bitcoin market.

According to the company’s analysis, investors are finding it difficult to take positions in the current environment of ongoing global macroeconomic uncertainty, and this is having a significant impact, especially on Bitcoin, which is among the risky assets.

The analysis added that despite this “wait-and-see” atmosphere in the markets, there was no panic among Bitcoin investors. In particular, $BTC inflow data from Binance, one of the largest cryptocurrency exchanges, stands out as a significant indicator supporting this view. According to this data, the amount of Bitcoin entering exchanges has recently fallen to historically low levels.

According to the data, $BTC inflows, based on the 30-day moving average, have fallen to approximately 3,998 $BTC. This figure marks the lowest level in the last 6 years, similar to the lows seen in 2020. For comparison, daily inflows exceeded 19,000 $BTC in July 2023 and 25,000 $BTC in May 2021. Considering that the long-term average is around 11,000 $BTC, the current levels are approximately one-third of normal.

According to CryptoQuant, this sharp drop signals a significant shift in investor behavior. Investors are not inclined to sell their Bitcoins by sending them to exchanges; instead, they prefer to hold onto their assets. This naturally reduces selling pressure in the short term.

On the other hand, the analysis also stated that a more structural transformation in the market structure may be underway. The fact that some Bitcoin flows are now directed towards alternative investment vehicles such as ETFs instead of exchanges may be contributing to the decrease in inflows seen in on-chain data.

In conclusion, CryptoQuant notes that the current data indicates that the market has entered a cautious “wait and see” phase due to uncertainties, rather than a crash or panic selling.

*This is not investment advice.