On-chain data shows the Coinbase exchange has just seen a massive Bitcoin outflow, a sign that some large-scale buying might be going on.
Over 16,000 BTC Left The Coinbase Platform In The Past Day
As pointed out by an analyst in a CryptoQuant Quicktake post, Coinbase has observed a huge outflow for the seventh time this year. The on-chain metric of interest here is the “exchange outflow,” which keeps track of the total amount of Bitcoin leaving the wallets attached to a centralized exchange.
When the value of this metric is high, it means that the investors are currently withdrawing large amounts from the platform in question. Generally, holders take their coins out of the custody of these central entities whenever they plan to hold onto them for extended periods.
Additionally, the trend can also be a sign that these coins coming out are fresh buys, so exchange outflows can have an overall bullish effect on the cryptocurrency’s price.
On the other hand, the indicator having a low value may imply that there isn’t much interest in buying the asset right now. Depending on the trend in the opposite metric, the exchange inflow, such a value may either be bearish or neutral for the coin.
Now, here is a chart that shows the trend in the Bitcoin exchange outflow specifically for the Coinbase Advanced platform:
As displayed in the above graph, the Bitcoin exchange outflow for Coinbase has registered a huge spike in the past day. In total, 16,021 BTC, worth nearly a billion US dollars at the current exchange rate, has left the platform with this outflow. Given the massive scale, a large entity has to be involved here.
Coinbase, in particular, is known to be the preferred exchange for American institutional investors, so this accumulation may have come from one such trader. A more zoomed out view of the chart of the same indicator shows this certainly isn’t the first time such a withdrawal has occurred on the platform.
As the quant has highlighted in the graph, Coinbase has seen Bitcoin outflows of similar scale seven times in the year 2024 so far. Some of these buys preceded surges in the price, so it’s possible they were at least partially the instigator for them.
However, the more recent spikes have failed to produce any bullish effects on the cryptocurrency, so it’s hard to say whether the latest outflow would lead to any rally at all.
“There is a high probability that this transaction is a institutional purchase,” the analyst notes. “But on the flip side, it could also be an internal transfer by Coinbase.”
Naturally, if the latter is the reason for this apparent outflow, then the transaction wouldn’t really be relevant for the market.
Bitcoin Price
Bitcoin has seen a small jump of 1% over the past 24 hours that has taken its price back to $62,400.
