Despite major corrections in the market, investors are unwilling to sell their holdings
A total of $800 million worth of BTC was moved from exchanges amid the sudden price increase of the first cryptocurrency, which currently trades far above $40,000.
The sudden price increase came as a surprise to a market replete with fundamental and on-chain data suggesting another fall in digital gold, as the market failed to recover on several occasions.
But while the majority bet on the end of the bull market and a further drop below $30,000, centralized exchanges were constantly facing losses of their reserves, which indicated that traders are not actively selling as the majority thought.
The first positive sign for the industry was the “decoupling” of the majority of cryptocurrencies on exchanges and the stock market which plunged as Bitcoin and other digital assets traded either in the neutral zone or in the positive area.
How do exchange outflows affect the market?
Usually, negative exchange flow is considered a good sign for the market as selling pressure during periods of large outflows is considerably smaller compared to periods when traders and investors are actively moving their funds to centralized or decentralized exchanges.
Given that current BTC exchange flows remain negative, we can conclude that the majority of the market is not eager to sell its holdings despite Bitcoin’s negative performance over the past few months.
At press time, Bitcoin trades at $41,725 with a local high of $41,983. The cryptocurrency shows another positive trading day at 0.72%. Previously, Bitcoin pumped by 12% in one day, jumping from $37,100 to $41,700 in a matter of hours.
