When holdings of Bitcoin (BTC) are moved from cold wallets to spot markets, this is often seen as an indication of an intent to sell; often, supply will end up being higher than demand, which can lead to a steep drop in price. Notably, 1.69 million Bitcoin (currently the equivalent of $33.5 billion) was moved to crypto exchanges from September 7 to 13th, the highest amount of BTC moved since October 2021, according to data from behavior analysis platform Santiment. Interestingly, this inflow into exchanges across seven days is the most significant weekly spike in the last 11 months. Even if the Merge date has at long last arrived, some market watchers anticipate a precipitous drop in the price of Bitcoin.
Bitcoin drops after CPI data
Following the higher-than-expected US Core CPI figure, a significant surge in exchange inflows resulted in a 10% price decrease for Bitcoin in hours. The vast majority of bitcoin transactions took place from the spot exchange (Coinbase) to the derivative exchange (Huobi), and the bulk of the transactions came from an address 3-6 months old, as per CryptoQuant data. Most recently, there has been a large increase in the market’s selling pressure, matching a surge in the Exchange Whale Ratio (EMA 7). Crypto market analyst BaroVirtual noted on September 14, miner transfers to spot exchanges are off the charts. “Generally, the massive transfers of miners to spot exchanges are usually associated with subsequent pressure, i.e., miners are selling out, and the price of BTC is falling.” However, despite the influx of BTC into exchanges, Finbold reported on September 16 that the number of small Bitcoin holders had hit a record high as sidelined investors buy the dip. Indeed, the number of Bitcoin addresses holding at least 0.01 BTC hit a new all-time high of 10,702,698. The market is likely waiting for a possible bottom, and recent data indicates that purchasing appetite is waning, which is consistent with the market’s overall sentiment. Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
