Major Crypto Exchanges Experience Net Outflow as Bitcoin Surges to $35,000
On October 24, major cryptocurrency exchanges witnessed a net outflow of funds as the price of Bitcoin (BTC) briefly reached $35,000 for the first time in a year. This movement of assets away from exchanges is seen as a positive sign, indicating that traders are transferring their funds to secure storage in anticipation of rising prices.
Outflows from Exchanges Reflect Trader Sentiment
CoinGlass, a crypto analytics firm, reported that Binance recorded the largest outflow with over $500 million leaving the exchange in the past 24 hours. Crypto.com and OKX followed with outflows of $49.4 million and $31 million, respectively. Other exchanges saw less than $20 million in outflows.
Concerns about a “bank run” have arisen due to recent outflows from crypto platforms following the collapse of FTX in November 2022. However, these latest outflows seem to be driven more by trader sentiment than fear-induced withdrawals during the bear market. Glassnode data confirms that Bitcoin outflows from exchanges have increased alongside BTC’s price surge.
Liquidation of Short Positions and MVRV Ratio
The surge in price also led to approximately $400 million worth of short positions being liquidated. Within the past 24 hours, 94,755 traders experienced liquidation of derivative positions. The largest single liquidation order occurred on Binance, amounting to $9.98 million.
On-chain analysts have also highlighted the market value to realized value (MVRV) ratio. This metric compares a cryptocurrency’s market value to its realized value by dividing market capitalization by realized capitalization. The current MVRV ratio is 1.47, slightly below the 1.5 ratio observed during the previous bull run.
The Bull Market and Future Predictions
Hitesh.eth, a Twitter user, tweeted that when the MV Ratio stays above 1.5, the bull market begins. Currently at 1.47, Hitesh.eth believes that Bitcoin will reach $40,000 in the next few days, pushing the MV ratio to 1.6.
Market Cap Rises to $1.25 Trillion
Over the past 24 hours, the total crypto market cap has increased by over 7.3% to reach $1.25 trillion, its highest valuation since April. This surge is attributed to speculation surrounding the launch of a spot Bitcoin exchange-traded fund.
Hot Take: Bitcoin Surges as Crypto Exchanges Experience Net Outflow
The recent surge in Bitcoin’s price to $35,000 has resulted in major cryptocurrency exchanges witnessing a net outflow of funds. This trend indicates that traders are moving their assets away from exchanges to secure storage in anticipation of further price increases. The outflows align with trader sentiment rather than fear-induced withdrawals during the bear market, as confirmed by Glassnode data. Additionally, the liquidation of short positions and the MVRV ratio suggest growing market activity and positive investor sentiment. With the total crypto market cap reaching $1.25 trillion, driven by speculation around a spot Bitcoin ETF launch, it seems that the cryptocurrency market is experiencing significant growth.
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