{"id":170520,"date":"2020-08-26T11:00:22","date_gmt":"2020-08-26T10:00:22","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=170520"},"modified":"2020-08-27T08:24:42","modified_gmt":"2020-08-27T07:24:42","slug":"here-are-the-3-trends-causing-exchanges-to-see-massive-bitcoin-outflows","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/here-are-the-3-trends-causing-exchanges-to-see-massive-bitcoin-outflows\/","title":{"rendered":"Here are the 3 trends causing exchanges to see massive Bitcoin outflows"},"content":{"rendered":"

Exchanges have been seeing massive Bitcoin outflows in recent months, which has been a rapidly unfolding development seen by many as being bullish for the benchmark cryptocurrency.<\/p>\n

A reduced supply of the crypto on exchanges is a positive sign, as it suggests that investors are adopting a long-term approach to their investments, while also reducing the supply of BTC readily available to users on exchanges.<\/p>\n

One on-chain analyst believes that a combination of fears surrounding centralized platforms, increased \u201chodling\u201d behavior, and the rise of decentralized finance are the primary factors that are fueling this trend.<\/p>\n

If this is the case, then exchange Bitcoin<\/a> outflows may not slow down anytime soon.<\/p>\n

Exchange outflows ramp up despite Bitcoin\u2019s uptrend<\/strong><\/h2>\n

Throughout 2020, investors have been moving their Bitcoin off of exchanges at a rapid pace.<\/p>\n

The vast majority of these Bitcoin are likely being directed to offline storage, signaling that investors aren\u2019t interested in selling their holdings at the cryptocurrency\u2019s current price levels.<\/p>\n

This trend is a bit surprising, as exchange outflows historically tend to increase during periods of stability or weakness in the market, whereas investors move their crypto into exchanges during uptrends in preparation for taking profits.<\/p>\n

Throughout 2020, BTC\u2019s price has been seeing relatively consistent growth, climbing from $7,000 at the start of the year to highs of $12,400 just over a week ago, before declining slightly to its current price of $11,400.<\/p>\n

Throughout this entire period, investors have been regularly pulling Bitcoin off of exchanges.<\/p>\n

\"Bitcoin\"
Image Courtesy of Philip Swift. Data Source: Glassnode<\/figcaption><\/figure>\n

As seen in the above chart, this trend began picking up steam following the mid-March meltdown.<\/p>\n

Here are the factors behind growing exchange outflows<\/strong>\u00a0<\/strong><\/h2>\n

Philip Swift \u2013 a data analyst \u2013 spoke about this trend<\/a> while referencing the data from Glassnode<\/a>, explaining that he sees three primary factors behind this trend. These factors include:<\/p>\n