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Bitcoin headlines are moving their funds from the spot market to derivatives exchanges
According to on-chain data provided by CryptoQuant, Bitcoin majors send funds to derivative exchanges. The CEO of the company assumed that the reason might be filling in the margin or opening new positions.
The rapid increase in Bitcoin exchange inflows from large exchange wallets may become a worrying signal for market participants because, in most cases, when funds are moved from a spot market to a derivatives exchange, it becomes a signal to sell. Traders usually keep their money in exchanges when they are looking to sell it.
whales send BTC dollars To exchanges derived from other exchanges to bet on new positions or fill profit margins.
If you look at historical data, the price is rising in the long run after it has been accumulated. Their positions seem long. https://t.co/O0imZE7DIv
– Ki Young-ju 주기영 (ki_young_ju) September 10, 2021
But the CEO of CryptoQuant offered another version: some holders may start opening new long positions or fund their previous positions that came close to liquidation once Bitcoin drops sharply to $46,000. He also added that most of the time, whenever these wallets moved funds to exchanges, they accumulated large amounts of bitcoin, which led to massive price increases.
Previously, an increased derivatives flow was observed in October, right before the start of the last major Bolron game as Bitcoin moved from $10,000 to $60,000. The reason for this strong price increase was the highly leveraged positions. In order to ensure a significant increase in market volatility, most positions must be funded through derivative exchanges that provide high profit margins to traders.
The market most likely will not see the effect right away because the moving volumes are too large to be executed immediately. At press time, Bitcoin is moving at $46,000 after a sharp drop from $52,500 to $43,000 in one day.
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