Old Bitcoin Supply Moves Into Derivatives, Whales Setting Up Long Positions?
Originally posted here.
By: Hououin Kyouma
Overview
On-chain data shows Bitcoin supply older than two years has moved into derivative exchanges recently, suggesting whales may be positioning themselves on the futures market. Derivative Exchange Inflow Of Bitcoin Supply Older Than 2 Years Has Spiked Up As pointed out by an analyst in a CryptoQuant post, the recent short-dominant open interest has gone down while some old coins have just been shifted into exchanges. The relevant indicator here is the “derivative exchange inflow,” which measures the total amount of Bitcoin moving into wallets of all derivative exchanges. A modified version of this metric, the “inflow spent output age bands,” tells us what the individual contribution has been from the various holder age groups to the total inflows. The investor cohorts of interest here are those who have been holding onto their coins since at least 2 years without having sold or moved them (before now). Looks like the value of the metric has spiked up over the past day | Source: CryptoQuant As you can see in the above graph, the Bitcoin derivative exchange inflow from the 2 years+ old investor group has spiked up recently. This shows that these BTC hodlers are moving significant amounts to exchanges for setting up positions in the derivatives market. Related Reading: How To Become A Millionaire? Invest In Uniglo (GLO), Bitcoin (BTC) And Polygon (MATIC) It’s unclear whether this transfer is with the intent of opening long positions, or if it’s for hedging spot positions using shorts. However, the trend in another indicator, the open interest, may hold hints about the destination of these inflows. This metric measures the total amount of positions currently open on derivative exchanges. Recently, the funding rates were slightly negative, implying that the open interest was short-dominant. But as the below chart highlights, this indicator’s value has gone down during the past day. The value of the indicator seems to have slumped down after rising during the last few days | Source: CryptoQuant The value of the Bitcoin open interest declining can suggest some of the short positions have now been closed down. Related Reading: Bitcoin Price May Rally If Buyers Jump Above This Hurdle It now remains to be seen whether the market shifts towards a long-dominant environment or not in the coming days as exchanges receive fresh large inflows like the most recent one. BTC Price At the time of writing, Bitcoin’s price floats around $19.7k, down 2% in the last seven days. Over the past month, the crypto has lost 12% in value. Below is a chart that shows the trend in the price of the coin over the last five days. The value of BTC hasn’t showed much movement during the last few days | Source: BTCUSD on TradingView Featured image from André François McKenzie on Unsplash.com, charts from TradingView.com, CryptoQuant.com
The Post
On-chain data shows Bitcoin supply older than two years has moved into derivative exchanges recently, suggesting whales may be positioning themselves on the futures market.
Derivative Exchange Inflow Of Bitcoin Supply Older Than 2 Years Has Spiked Up
As pointed out by an analyst in a CryptoQuant post , the recent short-dominant open interest has gone down while some old coins have just been shifted into exchanges.
The relevant indicator here is the “derivative exchange inflow ,” which measures the total amount of Bitcoin moving into wallets of all derivative exchanges.
A modified version of this metric, the “inflow spent output age bands,” tells us what the individual contribution has been from the various holder age groups to the total inflows.
The investor cohorts of interest here are those who have been holding onto their coins since at least 2 years without having sold or moved them (before now).
Looks like the value of the metric has spiked up over the past day | Source: CryptoQuant
As you can see in the above graph, the Bitcoin derivative exchange inflow from the 2 years+ old investor group has spiked up recently.
This shows that these BTC hodlers are moving significant amounts to exchanges for setting up positions in the derivatives market.
It’s unclear whether this transfer is with the intent of opening long positions, or if it’s for hedging spot positions using shorts.
However, the trend in another indicator, the open interest , may hold hints about the destination of these inflows. This metric measures the total amount of positions currently open on derivative exchanges.
Recently, the funding rates were slightly negative, implying that the open interest was short-dominant. But as the below chart highlights, this indicator’s value has gone down during the past day.
The value of the indicator seems to have slumped down after rising during the last few days | Source: CryptoQuant
The value of the Bitcoin open interest declining can suggest some of the short positions have now been closed down.
It now remains to be seen whether the market shifts towards a long-dominant environment or not in the coming days as exchanges receive fresh large inflows like the most recent one.
BTC Price
At the time of writing, Bitcoin’s price floats around $19.7k, down 2% in the last seven days. Over the past month, the crypto has lost 12% in value.
Below is a chart that shows the trend in the price of the coin over the last five days.
The value of BTC hasn’t showed much movement during the last few days | Source: BTCUSD on TradingView
Featured image from André François McKenzie on Unsplash.com, charts from TradingView.com, CryptoQuant.com