On-chain data shows that a large inflow of Bitcoin has been received by exchanges over the past few weeks, which is a potential factor contributing to the bearish trend of this asset.

The Bitcoin supply on exchanges has recently been on the rise

In a new article on X, analyst Ali Martinez discusses the latest trends in Bitcoin supply on exchanges. Here, 'exchange supply' is an on-chain metric provided by the analytics firm Santiment, used to track the total amount of BTC in wallets connected to centralized exchanges.

When this indicator rises, it means that holders are depositing a net amount of tokens to these platforms. Since one of the main reasons investors turn to exchanges is for selling purposes, this trend could have a bearish impact on the token's value.

On the other hand, a decline in the indicator suggests that investors are transferring cryptocurrencies to self-custody wallets. This trend could indicate that the network is experiencing accumulation, which is a positive signal for cryptocurrencies.

Now, this is the chart shared by the analyst, showing the trend of Bitcoin supply on exchanges over the past few weeks:

As shown in the chart above, the Bitcoin supply on exchanges has been steadily rising, indicating that investors have been net inflowing. Over the past two weeks, holders have transferred a total of 20,000 Bitcoins to these platforms' wallets. At the current exchange rate, this amount is worth up to $2.2 billion.

The timing of these deposits coincides with a drop in cryptocurrency prices, so many of them were likely deposited for the purpose of selling.

In the same chart, Martinez also included data on exchange inflows, which shows all the funds flowing into these platforms, not just the net inflow. The indicator saw a significant spike over the weekend, followed by BTC continuing its downward trend.

Interestingly, despite such a large spike, the supply on exchanges did not show any increase, suggesting that the demand to withdraw cryptocurrencies was sufficient to balance the deposits.

Speaking of exchange inflows, short-term Bitcoin holders (STH), those who bought in the last 155 days, have recently made a significant number of loss deposits.

STH consists of the weaker hands in the market, so it is not surprising to see them capitulate during price declines. In fact, their significant stop-loss spikes helped Bitcoin reach a bottom, as their coin value transferred to more resolute entities.

Bitcoin Price

At the time of writing, Bitcoin is trading at approximately $110,500, down over 2.5% last week.