After another week of consolidation for bitcoin, with a drawdown to $31k, investors look to the weekend for a sigh of relief as the GBTC shares unlock continues.
On-chain analysts detected an unusually large inflow of 41,000 BTC over a few transactions into Coinbase Pro Exchange, in just one hour. The immediate reaction from Crypto Twitter was fear and calls for BTC “to $20k or $10k BTC.”
This looks like a bearish signal, but we have to recognize the fact that crypto exchanges are known to do internal transfers. Around the same time, On-chain Analysis detected similarly large outflows of 37,154 BTC from Coinbase Pro, as can be seen below:
Outflow and Inflow have the same number, which should be Coinbase’s internal wallet transfer. https://t.co/LOrM0vWWd4 pic.twitter.com/937nRELcTS
— Wu Blockchain (@WuBlockchain) July 17, 2021
If this was a one-sided event, this would have been an extremely bullish or bearish signal. Thankfully, the inflows and outflows were similar in quantity, making it highly likely this was an internal transfer by Coinbase Pro.
Aside from this odd event, On-chain Analysis did not detect any unusually high net flows in or out of other exchanges. This appears to be an isolated event.
As of the last couple of weekends, the liquidity is very low, making BTC susceptible to large swings up and down. A whale with over 40K BTC knows not to move such large amounts of BTC into exchanges because it will be detected and cause “pre-selling” in anticipation of an upcoming sell-off.
At the moment, there is no major reason to worry, at least about these large inflows and outflows.
