Bitcoin Exchange Inflows Increase in Face of Market Uncertainty

According to statistics from IntoTheBlock released on social media site X, last week $1.04 billion went into crypto exchanges. Not unexpectedly, this run of inflows canceled the outflows over the last three weeks. According to IntoTheBlock, this change in money flow points to increasing uncertainty among Bitcoin owners, mostly related with global political and economic uncertainty.

To exacerbate issues, the Bitcoin network saw a clear decline in transaction costs. According on-chain statistics, fees dropped 10.74% from the previous week. Often a negative indication, this drop in revenue indicates less network activity. While a decline indicates declining interest and less momentum for the price of Bitcoin, an increase in transaction fees usually indicates rising demand and greater market involvement.

Outflows from Spot Bitcoin ETFs might be a main cause of the increase in Bitcoin exchange flows. With persistent inflows driving increasing momentum, US-based Spot Bitcoin ETFs have been a main factor powering the bull run in Bitcoin this year. For these Spot Bitcoin ETFs, last week turned out somewhat differently, however.

Data from SosoValue especially shows that over the previous week US-based Spot Bitcoin ETFs saw $651.83 million in net withdrawals. Fascinatingly, since the first week of September 2024, this is the weekly outflow seen in these Spot Bitcoin ETFs the highest.

Given that it generates a selling pressure on exchanges, the Bitcoin inflows into crypto exchanges present a pessimistic scenario for the currency. Technical study reveals that Bitcoin is now caught between important demand and supply levels. While a 1.16 million BTC supply wall exists between $97,650 and $99, 470 crypto expert Ali Martinez claims there is a notable 1.43million BTC demand wall between $94,656 and $97,540. A breakthrough in either way might help to define the direction of the next significant movement.

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