By Lucas Williams
The past couple of days have witnessed exchange flow risen dramatically. The data revealed by the bitcoin chain unfolded that traders are blindly selling bitcoins on various exchanges across the globe, many do believe that it is an indicator that bitcoin is about to enter the bear market. A post by CryptoQuant said that small-scale investors are rushing on exchanges to sell their bitcoin assets. This could be an ideal opportunity for big investors to seize the opportunity and exploit the market for the maximization of profits in the future.
The report focused on three basic terms:
First, the miner’s flow total has increased, which shows that a fairly high volume of the token is sent from miners to exchanges. Followed by the transaction count flow, which indicates the transactions from mining to exchanges. A last mean amount of BTC transferred from miner to exchanges.
The data analysis revealed that the past two weeks have seen the highest volume of sales since November 2020. Bitcoin dropped to $3,000 in the month of May, the lowest point ever touched by Bitcoin. However, bitcoin recovered steadily. Still, there are some speculations that token is about to enter a bear market where its prices will be further drenched. Over the past month, the average bitcoin transferred tokens valued at around 60BTC. The past Saturday the number peaked at 100coins.
At the moment the mining environment is suffocating due to China’s crackdown. There has been an argument that the high number of bitcoin sales cannot be sited as the bear market is ahead. This could be possible that miners who are relocating their mining setups need finance. Hence, they are selling an even greater number of coins to support their expenditures. Moreover, crypto industry experts do believe that prices would be stable once the miners settle on new locations.
Recently, voices have been raised that Russian authorities are preparing a detailed plan to accommodate miners from all across the globe. Since the quantity of bitcoins sold is massive, this selling spree can have a diverse impact on the whole crypto market. The possibility of bitcoin prices slumps further will also decrease the market price of other crypto tokens.
Thus, the volume of sales rising can be considered as a bearish activity. But this doesn’t mean that the bitcoin price will surely go down.
There have been a couple of incidents where bitcoin retained stability in its price, even though sales volume was very high. Bitcoin’s ability to retain its price sets bitcoin apart from other cryptocurrencies. Currently, the BTC market price is around $30.7k, an 8% slum compared to a week ago. The Crypto market is surely the most volatile financial market.