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<a href="https://xpertsstudio.com/why-is-xrp-outperforming-bitcoin-today/” title=”Why Is XRP Outperforming Bitcoin Today?”>Bitcoin exchange balances increased by about 45,000 BTC since May 11
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BTC meanwhile fell from roughly $81,700 to $58,562 before recovering to around $79,000.
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Exchange-held supply stayed within a relatively narrow 54,000 BTC band even as Bitcoin recorded a roughly 40% low-to-high price swing.
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Rising long-term holder supply suggests other onchain metrics may offer more context about Bitcoin’s changing market structure.
One of Bitcoin’s most closely watched onchain signals failed to predict the cryptocurrency’s volatile summer.
Bitcoin held on centralized exchanges increased by roughly 45,000 BTC, or about 3%, between May 11 and Sept. 8, according to data
Normally, an increase in exchange balances is interpreted as bearish because coins moved onto trading platforms are considered more readily available for sale.
Bitcoin, however, followed a very different path.
The cryptocurrency traded around $81,700 in May before falling to $58,562 on June 30. It has since recovered to roughly $79,000, leaving BTC close to where it started despite a roughly 40% swing between its summer low and subsequent highs.
Bitcoin Exchange Supply Barely Moved
Santiment’s data shows exchange-held BTC remained inside a band of approximately 54,000 coins over the four-month period.
That represents only about 4% of the Bitcoin held on exchanges, even as BTC experienced considerably larger price swings.
Since May 11, exchanges have ultimately gained about 45,000 BTC.
“Exchange balance is a popular metric,” Santiment said, arguing that this summer it simply wasn’t a good predictor of Bitcoin’s price direction.
The finding challenges a common interpretation of exchange flows.
Historically, rising exchange reserves are viewed as an increase in potential sell-side liquidity, while withdrawals are often interpreted as accumulation or as movement into longer-term storage.
But moving Bitcoin to an exchange does not necessarily mean it will be sold. Coins can also move because of custody changes, collateral requirements or internal exchange activity.
Recent data illustrates the problem. One exchange-reserve tracker recorded more than 40,000 BTC in net additions over the 30 days through Sept. 3. Another dataset, however, showed 30- and 90-day exchange netflow moving averages remained negative as of Sept. 7. Differences in wallet labeling and methodology can therefore produce very different pictures of exchange activity.
Long-Term Holders Tell a Different Story
Source: finance.yahoo.com