Is this the end of the crypto rout? What the outflow of bitcoins from exchanges means
The growth of markets depends on the number of coins available for sale on the exchanges. And as the bearish influence wanes, soon oversold bitcoin (BTC, + 2.28%) could succeed in building a base below $40,000.
For the first time since April 22, the seven-day average net inflow of bitcoins to the exchanges has turned negative for the first time since the data from Glassnode.
Which means that the coins leave the exchanges after a four-week break. This may mean that investors have decided to keep their assets in anticipation of a rise in prices. Which is a sign that investors are starting to take on direct custody of their assets, possibly in anticipation of rising prices.
Investors usually dump coins on exchanges to sell assets. As you know, the constant net flow of crypto is stimulated by bears. This is why it’s called the bear path. Accordingly, the outflow of coins from the market is a bullish path.
On April 22, the seven-day average of net flows turned positive and rose to a 14-month high of 10,628 BTC.
The sale of bitcoins was gaining momentum, and on May 17, prices fell to a minimum of about $30,000. The decline marked a decline of more than 50% from a record high of $64,801 on April 1.
Already this week the balance on the exchanges fell by 7,597 BTC to 2.53 million.
In order to get cryptocurrency back on the bullish path, further crypto outflow from exchanges may be necessary.