Bearish: Bitcoin Transfers to Spot Exchanges at Highest Levels Since March 2020 Crash
Although bitcoin has already lost roughly 50% of its USD value in two months, the asset could be primed for even more adverse price developments. After the death cross and reports suggesting institutions are dumping, new on-chain data revealed that investors had deposited massive portions of their holdings to exchanges, which could lead to another sell-off.
Largest Exchange Inflows Since March 2020
A lot can change in the ever-volatile cryptocurrency market in a few months. In April, BTC seemed destined for new records, which were popping up almost daily until the mid-month peak of $65,000.
While the community sentiment was highly optimistic and members envisioned even a six-digit price tag in the following months, few very could have predicted what followed. And what followed was a gradual decrease in the next thirty days and a substantial price drop in the next week to $30,000 following FUD from China and negative news from Tesla and Elon Musk.
Although bitcoin recovered more than $10,000 in the next few weeks on favorable developments in El Salvador, this rally seemed somewhat weak due to China’s brutal crackdown.
Consequently, BTC started to freefall again and lost all progress in a few days. The fear is back in the market, and investors seemed determined to act on this. CryptoQuant’s researches pointed out that June 21st was the highest daily spike in bitcoin inflows from external wallets to spot exchanges since the mid-March 2020 crash.
Thus, such trading platforms saw their netflows turn “significantly positive for the first time since the distribution in the $50,000 range.”
It’s worth noting that the aforementioned crash last March resulted in a 50% drop for BTC’s price in a day when it bottomed below $4,000.
It Gets Even Worse
Investors sending their bitcoins to exchanges is just the tip of the iceberg when it comes down to bear market signs. As CryptoPotato reported earlier this week, the 50-Day MA crossed below the 200-Day MA, resulting in a death cross for BTC. History shows that similar developments have previously led to adverse price movements.
Separately, other recent reports indicated that institutional investors have not only stopped allocating funds in bitcoin-tracking products, but they have started to make sizeable withdrawals.
Additionally, BTC whales have begun another worrying trend of disposing of their assets, which could lead to further price slumps.
