Recent on-chain data indicates that exchanges have experienced significant Bitcoin inflows in the past few weeks, which could be contributing to the asset’s bearish movement.
Bitcoin Supply on Exchanges has Recently Increased
In a new post on X, analyst Ali Martinez discussed the latest trend regarding Bitcoin’s Supply on Exchanges. The “Supply on Exchanges” is an on-chain metric from the analytics firm Santiment that tracks the total BTC held in wallets associated with centralized exchanges.
A rise in this metric indicates that holders are depositing a net number of tokens onto these platforms. Since many investors move to exchanges primarily for selling, such trends can negatively impact the coin’s value.
Conversely, a decline in this indicator suggests that investors are removing coins to self-custodial wallets, which can indicate accumulation and serve as a bullish signal for the cryptocurrency.
Here is the chart shared by Martinez, illustrating the trend of Bitcoin Supply on Exchanges over recent weeks:
The chart shows that the Bitcoin Supply on Exchanges has increased recently, implying net inflows from investors. Over the past two weeks, holders have deposited 20,000 BTC into these exchange wallets, equivalent to approximately $2.2 billion at the current exchange rate.
This surge in deposits coincides with the cryptocurrency’s price drop, suggesting many were likely made with the intent to sell.
Additionally, the chart includes data on Exchange Inflow, representing all inflows to these platforms, not solely net inflows. This metric showed a significant spike over the weekend, after which BTC continued its decline.
Interestingly, the Supply on Exchanges did not increase alongside this large spike, indicating that sufficient demand for cryptocurrency withdrawals balanced the influx of deposits.
Regarding exchange inflows, Bitcoin short-term holders (STHs), defined as buyers within the last 155 days, have recently recorded a notable amount of loss deposits.
STHs represent the more fragile market participants, so it is not unexpected to see them capitulate during price drops. In fact, significant loss-taking spikes from this group often assist Bitcoin in finding bottoms as their assets transition to more resilient holders.
BTC Price
At the time of this writing, Bitcoin is trading at around $110,500, having fallen over 2.5% in the last week.
