• Bitcoin exchanges have seen significant outflows since the collapse of FTX back in November.
• The „all exchanges netflow“ metric measures the net amount of Bitcoin leaving or entering centralized exchanges.
• Negative values of the metric indicate investors are accumulating, which could have a bullish impact on the price.
The Bitcoin market has been abuzz with activity recently, and it appears that outflows from exchanges are to blame. On-chain data shows that centralized exchanges have registered the most significant outflows since the collapse of the crypto exchange FTX back in November.
The relevant indicator here is the „all exchanges netflow,“ which measures the net amount of Bitcoin exiting or entering into the wallets of all centralized exchanges. This metric’s value is calculated by taking the difference between the inflows (the coins going in) and the outflows (the coins moving out). When the indicator has a positive value, it signals that the inflows overwhelm the outflows, and a net number of coins are being deposited to exchanges. Generally speaking, investors deposit to exchanges for selling purposes, so this trend could have bearish implications for the price of the crypto.
However, when the metric has a negative value, it implies that a net amount of supply is being pulled off these platforms. Usually, holders withdraw their coins from exchanges to hold onto them for extended periods in personal wallets. This could signal that investors are accumulating at the moment, which may have a bullish impact on the price.
Indeed, this appears to be the case, as the chart below shows the trend in the Bitcoin all exchange’s netflow over the last few months: it looks like the value of the metric has been quite negative recently. This suggests that investors are taking their coins off exchanges and holding them in their own wallets, likely in anticipation of a potential price increase.
Overall, the outflows from Bitcoin exchanges are a positive sign for the crypto market, as it indicates that investors are growing bullish on the asset. This increased demand could lead to a surge in price, so it is something to keep an eye on in the coming weeks.