Rising Bitcoin Exchange Inflows Spark Worries of Potential Selloff

From December 1, Bitcoin has been witnessing a rise in inflows to centralized exchanges, indicating a possible selloff.

As per data from IntoTheBlock, the Bitcoin (BTC) exchange net flows jumped from a net outflow of $69 million to a net inflow of $326 million. On December 3, the leading cryptocurrency saw a net inflow of $230 million.

In total, the data from ITB indicates that over $562 million worth of Bitcoin flowed into centralized exchange platforms.

Furthermore, the large holder-to-exchange net flow ratio for the asset increased to 0.86% on Tuesday, per ITB metrics. This metric implies that Bitcoin whales have been more engaged compared to retail investors.

Analytics reveal that large Bitcoin transactions, defined as those exceeding $100,000, rose from 17,960 to 25,830 in the same period as the increased exchange net flows.

The cumulative value of large transactions grew from $38.7 billion to $87.3 billion in BTC on Monday, December 2. Over the last week, Bitcoin amassed a total of $169.6 billion in whale transactions, as reported by ITB.

On-chain data indicates that an 11-year-old whale address containing 2,700 BTC, valued at over $257 million, made a transfer to another wallet for the first time since December 2013, potentially signaling a selloff after a 157-fold return.

This whale had acquired the Bitcoins when the price was around $625, totaling an investment of $1.68 million.

Currently, Bitcoin trades at $96,500 after a 1% increase in the last 24 hours, with its market capitalization again exceeding $1.9 trillion.

The heightened inflows into exchanges might lead to FUD (fear, uncertainty, and doubt) among retail investors. Yet, a rise in whale accumulation could alter market sentiment and induce buying pressure.

At this juncture, a significant bullish trigger for Bitcoin and altcoins may stem from a potential rate cut by the U.S. Federal Reserve, with the FOMC meeting set for December 17 and 18.