Bitcoin, which fell to $ 26,500 after the CFTC’s lawsuit against Binance, rose to $ 28,600 with a strong rise today.
While this rise has excited investors again, the cryptocurrency analysis platform Glassnode warned investors in its weekly Bitcoin and crypto money report.
Pointing to the increase in Bitcoin inflows on cryptocurrency exchanges in its recent report called “The Price of Time”, Glassnode said that there were approximately 4.18 thousand BTC inflows this week.
Comparing this week’s BTC inflows to the LUNA crash in May 2022, Glassnode said, “Bitcoin inflows this week were the biggest net increase since LUNA crashed in May 2022.” said.
Adding that this is an indication that investors are realizing their profits, Glassnode included the following statements in its report:
“In response to the strong price increase in recent weeks, investors have increased the volume of coins invested in exchanges.
Net currency flows rose to around 4.18k BTC this week.
This shows that investors are realizing their profits.
All previous examples with larger net inflows have brought with them major market volatility events, often to the downside.”
At this point, Glassnode stated that increasing BTC inflows could signal a near-term pullback in the market.
However, opening a parenthesis on the subject, Glassnode stated that although there is a possibility of a pullback, the current profit rates have not yet reached the levels recorded at the end of a bull market, so this data alone cannot be interpreted as a bearish signal for Bitcoin.
“We note that the size of realized profits still remains well below typical bull market levels.”
Finally, Glassnode stated that the majority of BTC still does not appear to be active on-chain, stating that this shows that investors continue to trust the dominant uptrend in the market.
In response to the strong price appreciation over recent weeks, net exchange flows have ticked higher by approximately 4.18k BTC this week, the largest net increase since LUNA collapsed in May 2022.
Read more in the latest Week-on-Chain 👇https://t.co/gr0R5tekCF pic.twitter.com/UHdv24JQC9
— glassnode (@glassnode) March 28, 2023
In addition to Glassnode, the increase in BTC inflows here should not be evaluated only in terms of sales. Whales expecting a drop in Bitcoin dominance can also use these BTCs to buy altcoins. Considering that Ethereum has an update in April, we may see greener days for altcoins in the coming days.
*Not investment advice.
If you are wondering about the effect of the Binance case on the market, you can review the news below.