On-chain data shows that some of the stagnant Bitcoin supply is moving back to exchanges, which could be bearish for the cryptocurrency’s price.
The flow of bitcoin exchange for old coins has seen spikes in recent days
As pointed out by an analyst at CryptoQuant MailRecently, some coins in the age group 2y-3y and 3y-5y have been deposited on exchanges.
The “exchange flow“It is an indicator that measures the total amount of bitcoin that is transferred to the wallets of all central exchanges.
When the value of this metric is high, it means that investors are depositing large amounts of money on the exchanges at the moment. Such a trend, when it lasts for a long time, can be bearish for the value of the cryptocurrency as it can be a sign of a sinking of its owners.
A modified version of this indicator is the internal exchange flow”Expired output life ranges(SOAB), which tells us about the individual contribution to the total inflows from different supply groups in the market.
These combinations are ranked based on the amount of time their coins have been stable. The relevant age ranges here are “2y-3y” and “3y-5y”; The chart below shows the trend in the inflows of exchange from these supplies:
Looks like the value of the metric for these cohorts has been raised in recent days | Source: CryptoQuant
As you can see in the above chart, Bitcoin exchange SOAB flow for these coin groups has been on the rise over the past two days or so.
This means that some investors have deposited large amounts of coins that are between 2 to 3 years old and those that are 3 to 5 years old.
This old offer is called the “long-term” offer. In general, the more coins advance, the less likely they are to move at any time.
Therefore, any movement of these currencies, especially those to exchanges, may have noticeable effects on the price of Bitcoin.
At the time of writing this report, Bitcoin price It is floating around $19.1k, up 1% in the past seven days. Over the past month, the cryptocurrency has lost 1% of its value.
The chart below shows the currency price trend over the past five days.
The value of the crypto seems to have rebounded back from the dip a couple of days ago | Source: BTCUSD on TradingView
Bitcoin continued to show stale price action in the past week with the crypto mostly remaining around the $19,000 level. A couple of days or so ago, BTC attempted to break the monotony by dropping below $18.7K, but it wasn’t long before the coin reverted back to $19K.
Featured image from Max Saeling on Unsplash.com, charts from TradingView.com, CryptoQuant.com