According to Glassnode, cryptocurrency traders delivered the highest inflows to cryptocurrency exchanges in 2022, while the crypto market fell to levels seen in July 2021.
Traders exchanged $5.6 billion in Bitcoin on centralized cryptocurrency exchanges from Glassnode’s tracked list, according to the on-chain provider’s statistics. The market’s total inflows will be much greater.
Aside from Bitcoin, traders were actively selling their Ethereum holdings, moving $1.3 billion through trading platforms. In comparison to Bitcoin’s netflow, the difference in outflows and inflows for Ethereum is less important.
The demand for Tether stablecoin soared during the cryptocurrency market’s capitulation, resulting in a negative netflow. Aside from market dynamics favoring Tether, the de-pegging of the UST stablecoin may have resulted in a shift in trade volume to alternative stablecoins such as Tether.
What impact do massive inflows have on the market?
The rising rate of inflows demonstrates traders’ and investors’ reluctance to keep digital assets. That’s, because they want to extract profits or losses and exit the market. Active selling, on the other hand, creates a supply glut on the market. Thereby, resulting in a discount and the possibility of a trend reversal.
Bitcoin has already seen a tremendous bounce from $29,000 to $32,000 in a matter of hours. Demonstrating the abundance of any resistance over $30,000 up until $40,000 as the market correction occurred in a matter of days.
The amount of longs on controlled exchanges also indicates a good trend toward the market’s steady rebound after a 23 percent loss in recent days.
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