On-chain data shows the Bitcoin inflows to Coinbase have spiked recently, a sign that may turn out to be bearish for the crypto. Bitcoin Exchange Inflows To Coinbase Register High Values As pointed out by an analyst in a CryptoQuant post, a total of 20k BTC was transferred to Coinbase recently. The “exchange inflows” is an indicator that measures the total amount of Bitcoin currently being transferred to an exchange (which, in this case, is Coinbase). When this metric’s value is high, investors send many coins to the exchange right now. Since one of the main reasons holders deposit to exchanges is for selling-related purposes, this trend can have bearish implications for the price of the crypto. On the other hand, low values suggest investors aren’t making many deposits to the exchange. Such a trend could either be bullish or neutral for BTC, depending on whether the market-wide inflows are also down or not. Related Reading: Litecoin Whale Withdraws $32M In LTC From Binance, Good Sign For Rally? Now, here is a chart that shows the trend in the Bitcoin inflows to the crypto exchange Coinbase over the last couple of months: Looks like the value of the metric has been high on several occasions in recent days | Source: CryptoQuant As shown in the above graph, the Bitcoin exchange inflow to Coinbase has recorded many sizeable spikes in the last couple of weeks. However, as is apparent, there were no significant price moves following any of these large deposits. These spikes were not that big individually. So if the investors who made these transfers dumped their coins as soon as they completed the transactions, it would make sense that they couldn’t cause any volatility. However, the quant notes that there could be another scenario here. What if the holders responsible for these inflows haven’t pulled the trigger on the selling yet? It’s not unusual for investors to deposit their coins to exchanges in advance, waiting for the right movements in the price to exit. Related Reading: Brace For Impact? Bitcoin Open Interest RSI Forms Bearish Divergence All these transfers amounted to around 20,000 BTC entering into Coinbase’s wallets. At the current exchange rate, this stack would be worth around $336 million, which is certainly large enough to cause volatility in the crypto’s price if sold all at once. “Of course, if it were sold right after the deposit, the situation would be different, but you need to be careful if it hasn’t been sold yet,” cautions the analyst. BTC Price At the time of writing, Bitcoin is trading around $16,800, up 1% in the last week. BTC seems to have seen a small increase in the last few days | Source: BTCUSD on TradingView Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, CryptoQuant.com
